Friday, 19 December 2008

Why Organizations Succeed and Fail: A Corporate Reputations Perspective

For those of us interested in why organizations succeed and fail from a reputation management perspective, one of the books of the year is 'Taking Brand Initiative: How Companies can Align Strategy, Culture and Identity through Corporate Branding'. This book is especially timely because it helps explain important elements of the current crisis of financial services, and also helps us explain some of the problems being experienced in healthcare. The book's authors are two of the best academics in the field - Mary Jo Hatch and Majken Schultz. They have produced a practitioner-oriented work that should be read by all HR, corporate communication, marketing and strategy professionals. The book is based on an ongoing research programme and ideas that first saw the light of day in an article in the Harvard Business Review in 2001, material which we used in our corporate reputations, branding and managing people book. It is also based on an edited book written mainly for academics on organizational identity.

Using this lens and a theory of organizational identity, they restate their well-known idea that organizations should constantly work towards aligning their vision (for being different and legitimate), their image (or reputations among key stakeholders) and culture (how employees and managers think, feel and act) for corporate branding to work and for organizations to be sustainable in the long run. They cite many examples from their own research and the work of others to demonstrate the validity and usefulness of their model, as well as draw on a considerable body of sound theory that should give some comfort and to practitioners and academics alike. Though they don't use financial services companies as examples, their analysis, especially of organizational narcissism, should be required reading for banks worldwide, a line we took in a case in our corporate reputations and HR book questioning the future fitness of the financial services industry in 2006.

Some of the key messages of this book are as follows. First, the 'most successful corporate brands simultaneously communicate belonging and differentiation...' (p. 21), a simple but powerful message that applies to private and public sector organizations, including our current work on the health service which is faced with major difficulties in attracting talent in the longer term, in enaging its current employees and in having a lack of image among employees for being a patient-centred service. They argue that organizations which are able to manage the tensions between integration and differentiation, one of the key paradoxes in business, do so by conducting continuous identity conversations with employees, customers and other stakeholders to create strong organizational identities. These conversations attempt to reconcile the fundamental and ongoing questions of 'who are we' as an organization with 'what is their image of us'. The attendant identity dynamics often result in two different but related dysfunctional states - hyper adaptation and narcissism. The first of these is where organizations are over-reactive to what customers and the media (and sometimes employees) think of them, so they continuously search for 'coolness' and 'cutting edge' instead of having regard for their unique heritage and core competences. The second is where organizations fail to check their internal beliefs against what stakeholders, including employees, think. This is often associated with narcissistic, charismatic leadership, protected from reality by group think, which attributes past success to their own insightful decision-making rather than the often favourable contexts in which such decisions are made - the so-called fundamental attributional error. The limitations of charismatic leadership and problems of narcissism, the subject of a brilliant book by Rakesh Khurana, was behind Enron and other corporate governance distasters, and in also being used to explain the failure of many of our financial services firms in the UK and USA.

A second lesson concerns the valuation of brands (and by implication employer brands). They make an important point in highlighting the limitations of brand valuation models, which, among other problems, ignore the emotional and symbolic effects of brands. As recent research has shown, these are the two most important factors in making employer brands attractive to outsiders and engaging for insiders. To gain real insights into (employer) brand value they argue that brand equity and consumer research models are more appropriate because the uncover and account for symbolism and meanings through ethnographic research into how people (employees) interact with brands and qualitative research into the meaning that brands hold for them. Which is what we have been doing in the health sector in Scotland as a complement to large-scale quantitative research.

A third lesson that is especially important for HR is the nature of the endgame. Long terms effective and sustainable corporate branding is what most organizations are striving to achieve to remain successful. This requires organizations to go beyond (1) first wave branding, which is based on a marketing mindset and is dominated by marketing/communications departments, and (2) second wave corporate mindsets, which attempts to bringing together multifunctional teams of mainly internal stakeholders, but typically ends up being fragmented by incompatible models and mindsets. Instead they posit a third wave notion of enterprise branding, which is an interfunctional and and integrated way of bringing together internal and external stakeholders in the extended entreprise in constant cycles of identity conversations. They also flag the importance of Web 2.0 tools in conducting such conversations, a key message of our recent CIPD research in the field. This imagery of dynamic enterprise-wide conversation cycles is a particulary powerful one because it extends the notion of the corporation and gets us away from the typical brand 'programmatis', which is premised on the artifical notions of beginnings and ends of change. For HR, it also reminds us that employer brands are not the endgame but are merely an input into a continuous conversation of how organizations can remain successful.

The book is not without its shortcomings. In tantalising us with the notion of enterprise branding, I don't think they go far enough in fleshing out what this may look like - maybe they want us to write what we want into this open space? They also seem to misinterpret employer branding to mean recruitment, when it is usually taken to apply to both the attraction of new employees and engagement (read identity management) of existing employees. However, these are minor points and should not detract from an important book which should be read by for all practitioners, particularly chief executives and HR directors, interested in this field.

Sunday, 7 December 2008

The Dangers of Branding Leaders (and Roy Keane)

Julie Hodges and myself are in the middle of writing an article on leadership branding, so I was intrigued by a recent post on the Australian HR online magazine (5th December, 2008, HR Daily), which appeared with the headline ‘Strong CEO brand improves candidate attraction and retention’
Citing a study by Minolta in Australia, ' Richard Branson (Virgin), Bill Gates (Microsoft) and Steve Jobs (Apple) are the business leaders Australian workers are most inspired by. Westpac CEO Gail Kelly was the only Australian CEO to make the top five list. Workers were also asked to identify which of the world's biggest companies they would most like to work for. Google topped the list, followed by Microsoft, Virgin, IBM and Apple. Locally based banks Macquarie ANZ, Westpac, followed by BHP Billiton, a mining company, ranked sixth, eighth, ninth and tenth respectively.

This headlining of leaders is further testament to the notion of ‘celebrity firms’ being tied up with celebrity leaders. Violina Rindova, and her colleagues in a 2006 article in the Academy of Management Review entitled ‘Celebrity Firms: The Social Construction of Market Popularity’ argued that a celebrity firm is developed from the media’s search for organizations that symbolize important changes in society by taking bold or unusual actions and which attempt to create distinctive identities. These firms are natural targets for ‘dramatized realities’ created by the business press. Google is one such firm that has become one of the most widely discussed success stories in the business press; also Apple whose products define the industry standard.

Most of the business press coverage focuses on the founders. For example, Google is often reported by referring to Larry Page and Sergey Brin. An Economist article of January 2006 portrays Page as the ‘visionary geek-in-chief', pronouncing at software conferences on the range of new products that will help Google achieve its ambition to ‘organize all the world’s information’. The storyline portrays the firm’s celebrity through Page’s missionary fanaticism, claiming that visitors to Google feel they are in the company of religious zealots rather than ordinary employees. Much the same story could have been written for Apple in the 1980s and, to a lesser extent, for Virgin over the last decade or so.

Though employees and the business press may feel the need to put leaders on a pedestal because of their requirements to find simple solutions to the complex problems of explaining why firms (and football teams!) are successful, are there dangers in doing so, and in having a corporate brand so closely linked to celebrity leaders?

My answer is yes. Much of the academic evidence points out that senior leaders don’t have a major impact on organizational performance. For example, Jeff Pfeffer and Robert Sutton claim that the hard evidence shows the impact of leadership on performance are modest under most conditions, strong under a few conditions, and absent in others. ‘Studies from leaders from large samples of CEOs…, university presidents to managers of colleges and professional sports teams show that organizational performance is determined largely by factors that no individual - including a leader - can control’ (‘Hard Facts, Dangerous Half-Truths and Total Nonsense’ p.192) Like a number of writers in this field, they also point to the dark side of leadership – narcissism, ruthlessness, group think and risky decision-making by people believing themselves to be all powerful. So, is it better to have leadership brands that are less reliant on powerful individuals and more on distributed leadership throughout the organization, i.e. build organization systems and brands where the actions of powerful and skilled individuals matter least. And should leaders act more wisely by knowing when to get out of the way so others can make contributions?

My own football team, Sunderland, provides a dramatic recent example of the problems of celebrity and wise leadership. Roy Keane, its talismanic manager, was over-loaded expectations by success-starved supporters seeking ‘instant pudding’ and a sports press always on the lookout for celebrity stories. Keane acted wisely by resigning when there were no calls for him to do so. He rightly expressed his self-doubt that no sane person could live up to such expectations (and implicit leadership theory –see earlier post) and resigned in as low key a manner as he could. Good for him and a lesson to other leaders (and firms seeking to brand themselves on the basis of individual leaders).

Wednesday, 26 November 2008

Employer Branding in China

On the last leg of a marathon, which has finished in Beijing. I'm the guest of a joint venture between our centre in Glasgow and a newly established, practitioner oriented research centre in Bejing. The Cente for Employer Branding and Reputation Management is a collaboration between Peking University (the number one university in China), (one of the largest recruitment consultants in China) and CCTV, which produces the 'Best Employer in China' awards. Such a coming together of big brands in China is testament to the emerging interest in this concept (somewhat similar to Australia in last blog), as was the three hundred or so HR executives, graduate students and staff who turned up to a conference on the subject where I gave the keynote speech and received a visting professorship from Peking University.

The Chinese project is being led to my long time colleague, ex-PhD student and co-author, Dr Hong Zhang, who is currently editing a book on employer branding in China, due out late next year. My impressions from meeting with colleagues are that employer branding and reputation management are concepts that will take root in this most complex of societies. There are two reasons underlying this prediction. The first is the concern with image and identity, which, according to colleagues, is a major issue with employers in China. Consulting report after consulting report lists image and reputation as major pre-occupations of Chinese CEOs. Part of this interest seems to be a result of a lack of confidence among Chinese companies, and part is due to the second reason - the talent management agenda.

Talent management - attracting, retaining, motivating and engaging people - still remains a major issue in the big cities in China, despite the downturn in economic growth (accurate statistics on this issue are not easy to come by). A recent McKinsey report on talent management in China seems to support this impression, which is also the belief of my new colleagues in the Centre. I'm based in an hotel located in a science and technology centre next to the two big universities in Beijing, which has every big technology company in the world resident on its huge science parks. These companies require talented people and the Chinese universities cannot put them out fast enough; nor can they deliver the right levels of quality to turn this country into the knowledge-based economy in aspires to. As a consequence, Chinese companies are beginning to operate in global labour markets for talent, and its shows. Compared to my first visit fifteen years ago, the number of non-Chinese working over here has grown enormously, so much so that they have begun to locate themselves in the equivalent of 'gated communities'.

This new venture has plenty of interesting questions to ask of employer branding and talent management, and I look forward to helping them.

Friday, 21 November 2008

A Great Week with Australian HR Professionals

I've just spent a spectacularly enjoyable and informative week with more than 250 HR professionals in Australia in Melbourne, Brisbane and Sydney as a guest of ADCORP, one of Australia's largest marketing and communications firms. ADCORP specialises in employer branding, and during the course of interaction with their consultants and clients, it soon became apparent that they do some very good practitioner-oriented research and creative work in this field. As part of their programme to support their clients and to learn more about what academics have to say about these issues, they asked me to lead a number of sessions on employer branding and on other HR-related issues I'm currently researching, e.g. strategic leadership, Web 2.0 etc.

From these sessions, a number of items re-occurred. These are worth summarising for the people who attended because they and others may have better answers to the questions than I do.

The first is something we wrote about in 2003, when we produced the CIPD's first research report on employer branding: 'What's in a Name'? There is no doubt that, in some knowledge-based, professionally dominated, industries - healthcare, professional services, consulting engineering and education, what's in a name really matters. This was confirmed by a number of discussions, during which branding was seen to connote spin and anti-professionalism among key managers and professionals. On this issue, my argument has been for some time that the notion of reputation management is more likely to appeal to internal stakeholders in certain companies/ industries and probably more accurately reflect what the process is about - underscoring legitimacy in external and internal labour markets for good governance and leadership, ethical practices and CSR, as well as creating difference in these markets through branding.

The second notion that seemed to strike a chord was the need for HR to be the guardians of 'authenticity' in employer branding. Employer brands which aren't rooted in what really matters to employees and potential employees are unlikely to be effective. Indeed, these top-down 'designed' brands are more capable of creating cynicism through perceived attempts at 'brandwashing' and dissappointment among employees through overpromising and underdelivering. One of the lessons is that HR needs to drive employer branding to prevent it being dominated by corporate communcations and marketing, functions which often struggle with the notion of bottom-up design or co-creation.

This issue raised an important discussion around segmentation: should and can organizations tailor EVPs to segments, and on what basis should we construct segments? Among the many interesting discussions we had on this topic were ones related to how far you go with segmentation and how do you relate segments to high performance, and to what extent do you privilege the 'global' over the 'local'. A number of organizations have begun to segment their employer branding on the basis of lifestyles, but do EVPs that appeal to lifestyles produce significant benefits for organizations? Also some organizations are wrestling with the problem that idenity and employer branding are essentially local phenomena, yet organizations seek to impose and privilege the corporate brand over the local brand (perhaps reflecting the dominance of marketing and comms). Is this the right way around for employer brands in frequently culturally diverse businesses? Or should we go for the equivalent of endorsed branding strategy, which is sometimes used in customer-facing corporate branding? Again, context is all important; there is no 'one best way'.

A third issue was the role of leadership and its impact on branding. It was clear from discussions that the idea of leadership branding was seen as an integral part of employer branding. Either because leaders have an important influence on the reality of employer branding through their actions in 'walking the talk' or other wise, or because we expect them to, the reality is that leaders (and recruiters) really matter in how people externally and internally experience employer branding. So, should employer branding always incorporate leadership branding?

A fourth issue was measurement. Very little is done in this direction, though for nearly all participants measurement is an absolutely critical issue in making a business case and in evaluating effectiveness. So, we had a lot of discussion around the notion of how to measure employer brand equity through psychological contracting, surfacing images, brand awareness, and some of the more conventional recruitment and retention metrics. For employer branding to really take-off (and for HR credibility), measurement has to be a lot more effective than has hitherto been the case, even allowing for the fact that what is measurable isn't always meaningful and the value of intangible assets.

A fifth issue was the importance and use of the term, Gen Y, which is more widely discussed in Australia than it seems to be in the UK (where the demographic problem is more about managing an ageing workforce). As we have pointed out in recent publications and will do in our forthcoming report for the CIPD on Web 2.0, Gen Y is a crude term than may do more damage that good. The problem seems to be associated with the 'fallacy of misplaced concreteness', in which shorthand labelling (of often diverse groups) begins to have real consequences; the more we think of the younger age groups as Gen Y, the more we treat them uniformally as Gen Y, despite the wide variation of lifestyle and behavioural differences within this group. So, do we need to be a bit more sophisticated in our research?

Friday, 14 November 2008

Employer Branding in a Recession

I'm increasingly being asked to comment on the need for employer branding in the current economic circumstances? Just how relevant is it when the context for the 'war for talent' has changed? So here's my take on this.

Prediction in an increasingly unknowable world is fraught with problems, as books like the Black Swan point out. I'm not trying to play the recession down because for many people and industries, it is - and will become - very severe. However, there are a few longer term trends which seem to suggest that employer branding may become even more relevant than before.

The first point to note is that employer branding is not just, or even mainly, about attracting new talent but is also about engaging, motivating and retaining existing talent. And these processes are subject to the same kinds of dynamic expectations among employees that I noted in the last post. Most of the good evidence on engagement suggests that organizations in general are not getting any better at this, despite the enormous investment in ever more sophisticated HR techniques. In part, I suspect that this is because these self-same HR techniques and the promotion of so-called best practices are leading to a ratcheting-up of expectations by employees of what constitutes a good employer. The more exployers are drawn into branding, the more the ideal standards they promote influence minimum standards of legitimacy in this field. This ratcheting-up influence is likely to become even more exaggerated as evidence on the ideal standards among prominent firms in the 'employer of choice' game become seen as the norm as a consequence of heavy promotion in the business media. So the criteria for what may have been seen as an employer of choice a number of years ago becomes the the necessary table stakes, even in a recessionary context.

Second, demographics worldwide point to ageing populations, decreasing numbers of young people entering the labour force and changing expectations among those young people that do. These three demogrpahic trends may well be shaped by recessionary economics but suggest talent wars will not diminish in the medium to long term, so organisations that ignore them will only succeed in storing up problems for themselves by neglecting their external and internal images as employers.

Third, in every recession I have experienced over the last thirty or so years, there has always been a shortage of talented people in certain occupations, and the knowledge-intensive nature of industry and competition in developed (and, increasingly, developing) economies will just add to that problem. As intangible assets become an ever more important strategic driver for organizations, so -called talent wars are unlikely to diminish (which is evidenced by current reluctance among financial services to give up their much maligned bonus practices, one of the probable causes of their current problems - see a case we wrote in 2005 on 'The Financial Services Industry: Unfit for the Future' in our Corporate Reputations Book).

So, I'm not saying that the recession will have little impact - of course it will. However, organizations that have invested in employer branding should continue to do so, and those that haven't may need to think hard about how they compete in labour markets that are affected directly and indirectly by demographics, knowledge-intensity and ratcheting expectations.

Corporate reputations, images and identity: how theory can help practitioners

I’m just about to begin a two-week stint running some courses and doing presentations on HR’s contribution to branding and reputation management in Australia and China. As always, I’m on the lookout for interesting material from academics to help me provide some insights into these important topics; hanging around airports and spending time on long plane journeys gives you plenty of time to do just that. So I brought with me the new edition of the Corporate Reputation Review (Volume 11, number3 for those interested). This special edition brings together leading people in the field of organizational identity to write about their emerging frameworks and data. In this increasingly arcane field, this special edition produces some gems. Though the papers are difficult to decipher, even for academics versed in the language of social identity and social actor theory, they yield some blindingly obvious-in-retrospect insights that cause me to re-think some of my ideas on employer branding, some research and consulting work we are doing in the field of employees’ images of healthcare organizations, and the nature of the HR.

The first is an examination of the well-worn distinction in the literature on reputation management between organizations’ needs to be simultaneously different and legitimate in terms of their organizational identities, the characteristics of which are their central, enduring and distinctive attributes (CEDs). Brayden King and Dave Whetten (the latter always a great bet for new insights) suggest that this ‘paradox of identity’ can be thought of in a rather different way than has hitherto been the case. Traditionally, this tension has been seen in terms of organizations attempting to solve seemingly incompatible needs for being different (i.e. branded) from competitors in product and labour markets but also being similar (social legitimate) to their comparators (e.g. being socially responsible, adhering to legal and governance standards, etc).
King and Whetten’s insight – rather obvious when you think about it - is that these needs are linked by the notion of ‘accountability standards’, which define norms of both appropriate behaviour (legitimacy) and esteemed performance (reputation).

Thus, when an organization seeks to become or remain a member of a business/ industry category, say a healthcare provider, it has to meet the minimum expectations of external and internal ‘audiences’ for patient care and the delivery of public value – the necessary, legitimacy-based conditions for membership. However, to become an esteemed member, it has to meet the ideal or aspirational standards of that group of businesses/ industry (reputation). The two, of course, are linked in the form of a continuum from minimum standards to ideal standards. And, because they are linked, changes in one have an impact on the other and vice versa. So, for example, as our expectations of the minimum standards of an employer change in relation to what might be expected, say, of an ‘employer of choice’, this leads to a ratcheting-up of our expectations of the ideal standards of an employer of choice - in other words, employer branding becomes a moving target. Similarly, as organizations compete harder to become employers of choice, such competition leads to a ratcheting-up of minimum standards. The probable results of this last dynamic is that the previously held ideal of an employer of choice becomes the the minimum table stakes, because audiences focus on, and increasingly use as their benchmarks, these prominent players in their industry and exclude reference to others.

Applying this line of thinking to the legitimacy and reputation of the HR function itself, you might be better able to understand how excellence in HR is no longer just associated with meeting the standards associated with cost control and service delivery to internal stakeholders, its two traditional and necessary functions (see Martin, Reddington and Alexander, 2008). Nor, we argue, is it good enough for HR to meet the aspirations of being ‘strategic’ (i.e. to contribute to corporate needs for innovation, customer satisfaction, productivity through high performance work systems, etc) , which has now become the prototypical expectation for HR excellence. Instead, HR needs to focus on the long term reputation and legitimacy of the organization itself by contributing to corporate branding, corporate governance and risk management, corporate social responsibility and ethics, and the creation of intellectual capital. These are all intangible assets, which, according to the well-known economist John Kay (2005), are the reason ‘why some nations are rich and others remain poor’.

The downside of this process, however, is that the market and competition over organizational and even professional identities leads to ever more risky behaviour, in much the same way that competition in financial services has seen firms develop riskier products and riskier HR strategies (talent management and bonuses). What will HR need to do next to help organizations become an employer of choice, and to become a function that rates high in the credibility stakes with CEOs?

The second article is by Kristin Price (who tragically died recently) and Dennis Gioia, both of whom featured in a recent blog. This time, their specific contribution is to raise the question: how can organisations improve their images in the marketplace for images – that is, among customers, employees, the media, prospective employees, shareholders, governments and the like? Building on their previous work on the notion of organizations having multiple, intended and unintended images, they propose the notion of the self monitoring organization. This concept is borrowed from the literature on individual differences. So just as high self monitoring individuals have to be vigilant about the multiple images of themselves (their own self concept, professional images, family members’ images etc), so high self monitoring organisations use a range of strategies and individuals to further the organization’s interests in reconciling self image with others’ images (the press, employees, prospective employees, shareholders, etc). Most of these are well known – brand ambassadors or even bloggers who are high in self-monitoring and become the eyes and ears of the organization, newcomers not yet socialised into the system, boundary spanning functions such as marketing, communications and, yes, and outward looking HR function, social networking and leadership liaison functions, which interact with outsiders, etc.

Two critical points emerge from this paper. The first is to expect multiple images in organisations and leadership difficulties in understanding them, especially if they aren’t high self monitoring as a group. The second is the problem of managing organizations with purposively different intended images, for example, a merger between two quite different companies even in the same industry. Both of these problems can be solved, to a degree at least, if organizations become high in self monitoring. As an afterthought, it in self-monitoring that Web 2.0 can make an enormous impact in helping act as the eyes and ears of the organization – another connection between technology and branding.

Tuesday, 4 November 2008

HR and the Governance Agenda

As part of our corporate reputations and HR agenda, I've been working on a chapter with a close colleague for a new book edited by Suzanne Young on governance. The chapter will focus on the links between HR and the governance agenda, but will do so from a public sector perspective, where governance issues are equally important.

Part of the reason for the book chapter stems from the current economic crisis, which, in part at least, is a crisis of governance. A few years ago, we wrote a case study on the financial services industry, which was sub-titled 'An industry fit for the future?' In that case we questioned the role of incentives in creating an industry driven by new business and new products rather than by servicing existing customers. Well, the forecast implied by the question in the title was along the right lines, with incentives, greed and lack of governance playing a role in most explanations of what has happened. So the challenge has to be raised, to paraphrase Bert Spector's classic paper on Enron, was HR the 'unindicted co-conspirator' in the demise of financial services?

To return to the public services, our work with some senior HR directors in the NHS in Scotland has led me to think about the links between how HR governs itself, and how that plays into the so called 'three pillars of governance' in healthcare - staff governance, clinical governance and financial governance. It has also led me to think about just how central an issue this is since governance seems to be about balancing innovation and risk in all three pillars and in the HR function itself. How HR organizes itself and is incentivised to be simultaneously creative and risk-conscious can have an enormous impact on how well employees experience their organisations as employers of choice, embracing principles of fair treatment, a say in decision-making, development, a good working environment and supportive leadership (staff governance). In turn, this has obvious consequences for clinical governance, which is concerned with balancing innovations in healthcare with patient safety, especially in so far as staff are fully trained and committed to caring/ prevention goals.

However, where HR at senior levels can really make their mark is at the corporate (read financial) governance level, providing advice and help in the selection, development, performance management and incentivisation of boards. As we have seen in the financial services sector, the culture of an industry and the organisations that represent it are shaped by leadership actions and the values they espouse. Consequently, HR and people management has a key role in to play in promoting their organisations as representatives of 'higher values' rather than just 'hired hands'. So, resurrecting the arguments of Karen Legge, my position is that HR needs to think less about being strategic partners (pace Ulrich) and more about more about becoming managers of reputations - for being simultaneously different (the branding agenda) and legitimate (the governance, ethics and CSR agenda). Any thoughts?

Saturday, 25 October 2008

Branding and Reputations: the Needs for Equivocality, Flexibility and Adaptability

It’s been my week for working on reputation management and employer branding. Along with colleagues in the Centre, I’ve just finished off a couple of draft reports on employer branding and reputation management for two of the largest health boards in Scotland, given a presentation on the topic to the senior executive team of another health board, and about to give a presentation on corporate reputations to a specialist conference on the subject in Rome in a few hours. So it was extremely helpful to have received a mail from a good colleague of mine, Kerry Griggs, from Charles Sturt University in Australia, who is working with me in this field. Kerry pointed me in the direction of an insightful academic piece in the Journal of Management Inquiry by Kirstin Price, Dennis Gioia and Kevin Corley from the USA entitled ‘Reconciling Scattered Images’, which has helped me make sense of the scattered images we have unearthed in our own health service research and revise some of our model building on employer branding, coming out in two books early next year by Ron Burke and Cary Cooper and by Paul Sparrow.

Price et al discuss organizational images from three perspectives. These are projected organizational images (self presentation), refracted images (how outsiders read specific aspects of an organizational image) and intercepted images (how particular employees and leaders interpret images, often based on the way insiders think outsiders see them). So far, nothing much new here, aside from new terms. However, it is what they make of these, often competing, images that help me make sense of organizations such as the NHS. They argue that these images are ‘best seen as ‘virtual commodities modified and exchanged’ in a marketplace for ideas about an organisation. Thus people hold multiple images of organisations, often at odds with the official one that organisations such as the NHS would like to dominate the marketplace for ideas about health providers. As an example, our research (on, in their terms, projected, refracted and intercepted images) has unearthed four competing and complementary images among health service employees in rank order of the 'volume' (a measure of frequency and intensity with which they were expressed during group interviews): as organisations dominated by financial governance, power and politics; as professional bureaucracies structured along strong clinical identities, as employers of choice; and as a patient-centred, caring organisations. Interestingly, while the first two images dominated, the last two were not widely held or consistently expressed during our interviews.

Price et al's key insight is that organisations such as the NHS need to be flexible and adaptable in identity management to cope with the dynamic environments in which they operate. In this way they become sustainable in the long run – the dynamic capabilities argument. Organisational image architects (and academics) need to think in terms of ‘image equivocality’ to mitigate the scattered images problem. Roughly translated this means they need to build in flexibility (relevant to time and context), consistency (non-contradictory images) and inclusivity (relevant and authentic to most employees and users). How organisations such as specific health care providers achieve this is dependent on their ability to create images that maintain employees’ appreciation of its needs for adaptability (say in moving care towards the community and away from hospitals, and in meeting ever stringent financial resourcing) while not producing cynicism and mistrust through projected duplicitous images (e.g. those emphasising patient care that health service workers sometimes find difficulty in buying into, given their perceptions of senior management's main concerns). Such projections have an awful tendency to come back to haunt them.

Political science tells us this is best achieved by creating images that constituents can write what they want into them, while still remaining consistent with their overall mission and values. Which is why we are advocating public value as a equivocal image for health services providers. This notion, part of another of our research programmes on healthcare discussed on this blog, seems to fulfil the criteria of flexibility, consistency and inclusivity because it is ‘what the public values’, an idea broad enough to be flexible,consistent and inclusive but also a compelling one. What the public values may change over time with ratcheted expectations of healthcare providers; it may also change over time to incorporate an economic as well as caring mission. However, it remains a consistent goal for many healthcare employees seeking to gain meaning from their work while being fairly rewarded and provided for, and being allowed to hone and utilise their professional skills. For example, new public sector financial stringencies will lead to investment problems for all healthcare providers in the UK, while demographic trends point to major problems in recruiting clinical and non-clinical staff from traditional labour markets. A public value image allows healthcare to reflect these environmental changes by being at the heart of economic development as well as a caring society - providing good knowledge-intensive jobs in regions that need them and in providing employment for disadvantaged groups who are often those most in need to healthcare as a consequence of their marginalisation (see the results between unemployment and health). These economic goals are easily reconcilable with a healthcare and prevention mission, and place Scotland’s healthcare providers at the heart of economic growth.

Is this a projected image that we can all write into it what we want to, while remaining consistent with the traditional values of the NHS?

Wednesday, 8 October 2008

New Insights into Web 2.0 and HR

I've been under the 'cosh' recently finishing off our CIPD report on Web 2.0 and HRM. I have to thank some bloggers who have helped provide insight and new material for the report and have done so in the written version. However, I would also like to acknowledge them online in case they don't read the document when it comes out in late November. They are James Hayton, James Richards, John Castledine, Jon Ingham and Thomas Otter.

To single out a few new recent pieces of research worth reading, James Hayton recently pointed me to a report by Pew Research on networked workers - excellent! Thomas also pointed to the advice given by IBM as a model for a code of conduct on Web 2.0. Finally, Julian Birkinshaw and Sarah Pass have just produced an interesting piece of work for the CIPD on Innovations in the Workplace: How are oragnisations responding to Generation Y and Web 2.0? This seems to be one of the few pieces of hard data on the lack of knowledge about Web 2 by HR professionals (and other managers in the UK) , which is also a finding of our work. This doesn't prevent HR professionals from being interested in the subject, however; indeed, we have found the situation to be the opposite.

As evidenced by research from Pew, Gartner, Forrester and McKinsey, there is strong justification for HR to be thinking in terms of and planning for a generation gap, which is one of the conclusions of the Birkinshaw and Pass study. However, this gap may be more of sociographic, V-generation one than Gen Y demographic one (see the other surveys referred to above). Birkinshaw and Pass also report evidence that HR sees potential in Web 2.0 and the need to address that potential, but just haven't done much about it. Maybe they have more on their plates just now with the problems of the financial services industry and the economy?

Leaving aside the hype, we side with those that believe HR need to address this issue strategically, or else they maybe left at the starting line?

Sunday, 21 September 2008

Strategies for Web 2.0 and HR

We are in the middle of writing our report for the CIPD on Web 2 and HR, which, as well as helping HR specialists understand what is going on in this space, has to help them develop policies and strategies to take advantage of these new social media. With this aim in mind, I've been reading a veritable rash of articles,books, blogs and the like aimed at advising companies on Web 2 and their dealings with customers. Two of the best of these are by Charlotte Li and Josh Bernoff(2008) Groundswell: winning in a world transformed by social technologies, Bostong: Harvard Business School Press and Amy Schuen (2008) Web 2.0: a strategy guide, CA:OReilly Media.

I'll say a little more in a later post about the second, but having just finished reading the first one I'm happy with my practitioner hat on to recommend it to HR colleagues or students seeking to implement or talk about implementing Web 2 into organizations.

The basic thesis of Groundswell is simple enough, though perhaps written in an over-evangelisitic tone befitting of US consultants from the American technology and media sector. It is simply this: that the democrastising features of the social web is enabling the ever growing numbers of people who use such technologies to 'get the things they need from each other instead of from companies' (p. x), which is a phenomenon that organizations can observe but can't control. Like most such publications, they invoke a form of social contagion, resulting in a widespread groundswell through emotional, behavioural and ideational processes. Brands and employer brands, are increasingly in the hands of customers and employees, and those 'on the street' who have the potential to influence these people. Correspondingly they are increasingly out of the control of companies, conventional marketing departments, public relations, communications and HR departments.

So far, nothing much new here, apart from some dramatic illustrations of these phenomonon. But in later chapters they begin to sketch out some 'hardish' data on these developments, a form of analysis they call 'social technolographics' that helps segment potential customers (and employees). Thus, they usefully distinguish creators (of content), critics (of others content), collectors (of content), joiners (who follow fashion), spectators (who consume content) and inactives (which formed 41% of Americans and 53% of Europeans in 2007). Like all forms of segmentation, the power of such analysis allows organizations to target their product offerings more effectively, using one of more of five strategies for addressing the external customer problem with Web 2. These strategies easily translate into strategies for HR to deal with internal customer 'problems', including engagement, employer branding, knowledge sharing and knowledge creation, based on a four stage analysis of people (what are employees ready for), objectives (what are your people management goals in introducing Web 2), strategy (how do you want your relationship with employees to change) and technology (what applications should you build).
The five strategies they identify are:
  • Listening to understand employees through digital research
  • Talking to employees by spreading digital messages
  • Energizing by building on the enthusiasm of key employees and using the power of word of mouth to spread the message/medium
  • Supporting employees by setting up tools to help them support each other, and
  • Embracing employees into the design of new product and HR process design and implementation
Each of these strategies is discussed in turn using case illustrations to show how organizations are using social media rather than simply relying on conventional market research techniques of surveying and focus groups and communications techniques. For example, listening is illustrated by continuously tapping into the different ways in which customers use social media to voice their opinions (volume as well as quantity), including customer blogs, rating reviews, social bookmarking and tagging, and discussion forums on community websites. Talking, by contrast is illustrated through the use of posting viral videos, enaging in social networking sites and user-generated content sites, joining the blogosphere to write manager blogs and creating online communities to listen as well as shout.

While the authors have a chapter on relating to employees, it is easy to apply the five strategies to HR and people management. Moreover, as the authors predict in their final chapter, 'groundswell' technologies are 'exploding' since they are cheap and easy to create and improve. They also draw on powerful social networking effects for their adoption, the key message of Amy Schuen's book, which I'll review in a later post.

Thursday, 18 September 2008

Reflections on the CIPD Harrogate Conference

A few further thoughts on the CIPD Annual Conference at Harrogate. Of all the sessions I attended, perhaps the two most useful for me were on the CIPD's 'Shaping the Future' programme and Jack Phillips workshop on Measuring HR and Determining Return on Investment.

The CIPD's Shaping the Future agenda, which you can find details of on their website, is an ambitious set of a dozen or so action research projects intended to help members learn more about the links between people management and high performance. As they stress, this is a research programme and a development programme, based on the premise that you only ever learn about something by trying to change it. For us, this is an excellent fit with our work as we run a number of action-research based masters programmes and are about to begin a major knowledge networking and action research programme of our own with senior HR professionals.

The second session on measuring HR directly played into our project for the the Scottish Government/ESRC on measuring human capital and its links with public value. Jack Phillips work has been influential in this field for some years but this is the first time I have come across him face-to-face. Personally engaging in a low key kind of way, he was the consumate HR professional, both in his presentation and in being 'content rich'. For anyone considering a project on measuring human capital, I strongly recommend an examination of his well-research and rigorous methodology - beginning with a look at his ROI website and attending one of his seminars.

Wednesday, 17 September 2008

CIPD Annual Conference and Web 2.0

I chaired a highly enjoyable interactive session at the CIPD Annual Conference at Harrogate yesterday, during which we took the chance to gain feedback from around fifty-five members about the relevance of this topic for their jobs and organizations. This cannot be described as a representative sample in any statistical sense, but provided us with an indication of the high level of interest in Web 2, but relatively low levels of understanding of its potential. This contrast was even more marked at a presentation we did at Olympia in June for the CIPDs software and recruitment event, where well over a hundred people packed into a space that could only seat sixty or so.

The session comprised of three purposefully short but highly informative presentations by three industry speakers on different aspects of Web 2 and its application to HR. These were followed by questions and break out groups to discuss key some of the key issues raised by the presentations and by our research for the CIPD. Andrew Unsworth, Head of E-Government at Edinburgh City Council, began with some evidence on the Virtual Generation and how it is and would affect models of organizational learning in his organization. This generational driver is one of the most important in getting HR to think seriously about how to incorporate these social media into their communications and ways of working, a point taken up in the following presentation by Tom McCabe, Head of Human Capital in IBM's North East Europe Consulting Division. IBM is a highly sophisticated user of the complete family of Web 2 media and a serious experimenter, which was demonstrated by a short video of how they are using Second Life as an induction and conference tool. He also explained how they used wikis, blogs and their in-house version of LinkedIn to create and share knowledge in the organization. For me, however, one of the most interesting applications was the Jam, where thousand of IBMers collaborate online to generate ideas for the company and to share their views. This demonstrated the power of Web 2.0 to reach parts that surveys can't reach, in ways they can't reach, which shows how employee voice can be surfaced and acted upon. Finally, Andy Hyatt, who leads Web 2.0 for Hodes, a recruitment and HR consulting firm, drilled deeper into the potential of social media for recruitment and selection. He provided a number of examples of how organizations are using interactive online media to connect with potential recruits, including passive candidates, which were topics of immediate interest to many of the audience.

Following questions of clarification, we posed five questions to the audience, which they discussed in groups. In true Web 2 spirit, they were also given the opportunity to discuss any other questions they thought to be more relevant. Our questions were of the type: what are the implications for knowledge sharing and collaboration, surfacing employee voice, etc in your organization. Also, what are the implications/ dangers for loss of control over the corporate message and/ or brand. We gained two strong impressions from participating in the groups and listening to the feedback from them. The first was that our questions weren't particularly relevant to them at this stage in their understanding; most participants were at a level of finding out about the basics of these new technologies. The second was that many were still pre-occupied with the dangers of open/democratic communications, and with the damaging impact on brands.

As Martyn Sloman from the CIPD suggested, these impressions were similar to those he gained during the early years of e-learning. Most HR professionals have not been in the vanguard of adopting new technologies in businesses, which was evidenced by the lack of interest in technological issues on their website - technology and HR ranked 400 and something on the list of important issues for them, some distance below many of the traditional 'tea and toilet' issues.

However, given the interest shown by the numbers of people that have turned up at these events on these new social media, we remain encouraged that the HR function is beginning to 'get it', an impression supported by many of the comments from participants in the room

Friday, 12 September 2008

A Final Thought from BAM: Two to Track on Leadership

The developmental papers at the British Academy of Management are always interesting because of the short presentations and long discussions, a format used in many conference nowadays.

I attended a few sessions on leadership to learn something for our research projects and was delighted to come across two pieces of work in progress that deserve a wider audience - which I'm sure they will get when they're more complete. One was on the popular topic of Authentic Leadership (based on Goffee and Jones's work) by Jane Turner from Northumbria. She has only recently moved into academia from practice, which was reflected in the practitioner-oriented nature of her excellent presentation. Authentic leadership focuses on being true to others and true to yourself, and she described work she was doing with a group of senior leaders to try to get them to get to grips with this concept and turn it on themsevles. The mode of action research and her results were of great interest to the audience, though there were some unresolved questions over what to do about the insightful reflections she had generated among her group of leaders. The notion of authenticity links both our work on strategic HR leadership and our work on employer branding; I'm certainly going to read more on this and look forward to seeing Jane's work in the future.

Gareth Edwards from the Leadership Foundation presented an excellent joint paper with Birgit Schyne from Portsmouth Business School on emotions and implicit leadership theory. This notion is a highly attractive one to me because it helps explain why leadership is becoming such an important topic. In a recent post on the NHS, I raised the issue of 'does leadership matter'? The objective evidence suggests it is not all that important to performance in many contexts but has become something of an industry. However, many of us in attitude surveys and in our everyday discussions about work raise the issue of leadership as an important one, because we hold implicit theories of what leaders should do and how they should behave, based on our individual and cultural belief sets. In other words, leadership can be thought of more as a phenomena created by followers to help them make sense of organizational life and performance, and because we need to attribute cause and blame to complex organizational problems (attribution). The paper raised two questions: how do emotional reactions to the same leader vary among followers and to what extent are these reactions shaped by the implicit leadership theories. Gareth and Birgit produced a very useful framework for explaining how follower characteristics and implicit leadership theories will cause employees to see the same leader differently and to generate different emotions reactions to him/her, which they hope to test in a laboratory setting. Again, I look forward to reading more because it helps us make sense of some results we are unearthing in out branding project for the NHS in Scotland. Leadership really seems to matter to employees perhaps because they expect it to make a signicant difference in this world of celebrity, which places incredible pressure on senior managers who are often unable to fulfil these expectations. This may be because of the difficult constraints they operate under (especially in political organizations such as the NHS) and simply because different people expect different things of the same leader. A no-win situation for mangers? Which might explain why leaders recruit in their own image and engage in emotion shaping culture management/employer branding/leadership branding programmes?

Two to Read for HR Specialists in Airlines and Healthcare

I enjoyed my first visit to the British Academy on Management (BAM) since 2001 (see previous post). Two papers in the HR stream particularly caught my attention. The first was a presentation by Greg Bamber, who is now at Monash, on a new book written with American and European colleagues (including colleagues from Glasgow - Judy Pate and Phil Beaumont) entitled 'Up in the Air: how airlines can improve performance by engaging their employees', Cornell University Press (januray 2009). The second was a paper presented by Paula Hyde and Claire Harris on 'Expectations and Performance in Healthcare', which is based on the study they, and others from Manchester Business School, undertook for the Department of Health and the CIPD on HR in the NHS in England.

The material on the airlines was very well researched and well argued, with some useful frameworks for understanding the relationships between commitment strategies and unionisation. The authors have done an interesting job in mapping out the changes in HR strategies over time of the low cost and legacy airlines, showing that being low cost and good at HR isn't incompatible. For example, South West Airlines has a positive relationship with unions, employees high commitment strategies and was the most profitable airline in the industry last year. Greg quoted a senior airline official from one of the pilots associations, which went along the lines of 'Why is it that other airlines don't get it'? It is clear that some don't and have developed other consistent strategies of low cost and low commitment HR/anti-union stance, which also have been successful. The problem children seem to be those airlines that, to borrow from Michael Porter's phrase, are 'stuck in the middle', neither making one decision or another. While this is an appealing analogy, it only takes us so far. Reminiscent of criticisms of Porter's boxology, life isn't quite so simple and if everyone followed the same strategy, where's the competitive advantage in that?

The HR in the NHS study is the culmination of three years 'hard labour' for a multi-author research project for the CIPD and Department of Health. For any HR manager in healthcare, this research is an essential read. Claire and Paula's paper provided some excellent data on HR strategies, psychological contracting and HR outcomes. They have also developed a very useful model bringing these issues together, which is both rigorous and relevant (the theme of the conference) to academics and practioners in healthcare. However, they may want to think about how the issue of public value might be incorporated into their model (see earlier post from work we are doing on human capital and public value) and on the notion of valued expectations in psychological contracting, which I discussed in our book on corporate reputations, branding and HR.

This is definitely one to read for my colleagues and students working in the NHS in Scotland.

See Hyde, P., Boaden, R., Marchington, M.P., Claire Harris, Paul Sparrow, Sarah Pass, Carroll, M. & Penny Cortvriend (2008) 'The process of engagement and alignment: Improving health through human resource management', Department of Health, Chartered Institute of Personnel and Development.

Blogging's Contribution to HR

James Hayton’s recent post on his Threee blog referring to the apparent stalling of social networking and James Richards work on blogging has got me thinking more and more about the contribution of this type of social media to people management and HR. So when the second of these two excellent HR bloggers brought our attention to a new book on the topic by Jill Walker Rettberg, an American academic teaching at the University of Bergen, I had to dash off to Amazon and buy it. En route to the British Academy of Management (BAM) annual conference in Harrogate, where I met some new friends from Australia (hello Naomi, Sandra and Elisabeth) and some old friends (hello Stuart and Anne Claire) who were interested in this topic, I read this short but excellent publication. In a field where it is difficult to find good writing that is both rigorous for scholars and relevant to practitioners - the theme of the BAM conference - this book is certainly one that will repay readers seeking to understand some of the serious conversations on Web 2 and get practical advice on how to blog. Not many attempt and clear the double hurdle of rigour and relevance but she does so admirably.

James Hayton rightly questioned the perhaps modish nature of social networking with his reference to a survey published in Mashable (see earlier blog) showing the dissatisfaction and lack of penetration among 18-65 year olds worldwide, while James Richards has focused on the extent and potential of blogging for employee voice in his work on organizational misbehaviour. Both of these academics raise important questions which has caused us to revise our thinking for the CIPD research Web 2. Jill Walker Rettenberg’s book addresses these issues head on. On social networking, she quotes a statistic that shows its potential among the ‘V-gen’. Facebook was originally developed for US college students and has now achieved over 90% penetration, a fact that was supported by the recent work on social networking at the AOM conference, which I reported on in an earlier blog. So while social networking may show signs of running out of steam among older generations, it seems to have become the norm among young, educated people, a fact not lost on some organizations and universities looking to recruit them.

Like James Richards, however, blogging is Rettberg’s preferred social medium and it is on the application and potential of this phenomenon that she scores heavily because her book works at different levels; it is also beautifully written. For anyone wanting to either begin to blog or improve their blogging potential, this book is a godsend (I’ll certainly use many of her ideas on how to make a blog more interesting and widely read); for any serious scholar interested in new digital media or any HR manager wishing to understand the potential of blogging in their own organization, it is a genuine ‘ eye-opener’. Unlike me, she has not come to this topic late, having researched and blogged in the field for most of this decade, so she shows a real mastery of her topic.

In a book of only 160 pages she explores fully the potential and problems of blogging. On the plus side, she outlines bloggers potential to democratise society (and the workplace) by creating a ‘modern public sphere’. To quote one famous press critic, ‘the power of the press is huge if you own one’; blogging now allows everyone to own a press. On the downside, she invokes the worries of both Plato and Jurgen Habermas, a modern social philosopher, to explain the dangers involved in having too many writers and readers because such a groundswell can result in a ‘ lacks authority and, ultimately, a lack of control’ (p48). Both of these perspectives on blogging are evident in our case research and in other research on Web 2 and HR. Some organisations, such as Microsoft, Google, IBM and UK government departments, see the potential for unearthing authentic employee voice through blogging and actively do all they can to encourage employees to blog; they also learn to with the consequences of the occasional and usually in the process rant. We recently made this point to the CIPD’s policy and research committee, which seemed to take this on board for their ‘Shaping the Future’ programme. However, most organisations want to control employee blogging or even ban it altogether (such as the UK armed forces but, interestingly, not their US equivalents). These organisations see significant threats to their authority to be sole authors of the official corporate story and brand identity, so that they attempt to control blogging through a range of mechanisms, ranging from banning employee blogs outright to bringing them behind the firewalls, having policies on what and what can’t be said if you want to keep your jobs, by having the communications departments monitor and respond to employee blogs or by creating corporate blogs or their own.

Walker Rettberg makes the point in her conclusions that the future of blogging lies not only in a form of direct participation by facilitating often unheard voices, providing a basis for participation in issues that truly matter to people, and in the power of a read-write web to collaborate and learn together, but also in an important form of indirect or implicit participation that is grounded in social networking theory. This kind of theorising, probably best known for the work of Mark Granovetter, points to the importance of ‘weak ties’. When we set up strong ties with colleagues, according to Granovetter, we are less likely to learn from them because we share with them common perspectives and common knowledge (we are likely to know and understand what they know and understand). By establishing lots of weak ties, however, we tap into perspectives and knowledge we are much less likely to know about. Thus social networking, outside of our Facebook friends or immediate contacts, is the best way of increasing our absorptive capacity for new knowledge, the sine qua non for innovation. Blogging, more than social networking sites, helps us do this by establishing more weak ties. At a deeper level, it allows organizations such as Google, Flickr and You Tube to harness our collective intelligence by mapping our IP addresses and use them to make recommendations on what might be of interest to us in the same way that Amazon does with books. It is not to difficult to imagine a situation in which the new attitude survey is replaced by software that maps our IP addresses and offers us tailored employee value propositions or knowledge. Indeed some of that future is with us already, with companies such as IBM mapping the social networks of their internal bloggers/networkers to create organizational structures around naturally occurring communities of practice rather than top down imposed structures that do not reflect hoe people interact.

See Jill Walker Rettberg (2008) Blogging, Polity Press, Cambridge:UK

Sunday, 7 September 2008

The Future of Social Networking and Blogging

We're putting together an article for People Management on Web 2.0 and HR as part of our project for the CIPD. Just in case anyone missed them, there were two very interesting posts in links to other blogs on this site last week. One of these focused on the mixed picture on social networking by James Hayton's Threee blog. He referred to an article in Mashable on September 3rd, referring to a report from Synovate, which showed that 58% of 18-65 year olds world-wide had no clue about social networking. To quote from the article:

'The survey of more than 13,000 people in 17 developed nations also asked if users were losing interest in social networks. According to the report, 36% said “yes,” with interest fading fastest in Japan, Slovakia, and Canada, with 45% of US users supposedly losing their appetite for social networking'

However, the article also points out that this survey leaves out teenagers who are the biggest users, and that provides optimism for providers in this space. Moreover, even in countries where internet penetration is high, such as the US and UK, less than 30% of internet users use social networking, which is evidence either of potential markets or lack of interest.

James raises an important question in his post: Does this suggest a lack of future for social networking? A discussion among academics at the recent Academy of Management event thought not, and we agree. However, social networking is only one aspect of Web 2, and for HR, we believe other social media have greater potential impact, including blogs, which is where the next post by James Richards in useful. Aside from his site and his own research, he has pointed to a new book on blogging which has just come out. It's called simply 'Blogging'. Written by Jill Walker Rettberg from the University of Bergen, it looks like an interesting piece of research into this field. She also has a good blog. I'm off to read it and report back.

Saturday, 30 August 2008

Human Capital Measurement and Performance

I've mentioned that we are doing some work, sponsored by the Scottish Government and the ESRC, on measuring the impact of human capital investment in the public services. One of the most useful pieces of research that we'll draw on is the Institute of Employment Studies (IES) report 'Human Capital Measurement: Approaches, issues and case studies', Report 454. This report, written by Dilys Robinson, Hulya Hooker and Mary Mercer, has only just been published in July 2008.

The report stemmed from a series of workshops with IES network members, some of whom were relatively advanced in linking their human capital measures to performance, including the Royal Bank of Scotland (RBS), Standard Chartered Bank, Civil Aviation Authority (CAA), Centrica, the Royal Navy, the MoD, two local authorities (East Sussex and Haringey Councils) and Medway NHS Foundation Trust.

It comprises a well-written review of some of the academic literature on human capital and a summary of the good consulting work in this field. However, the report's real strengths lie in the short case illustrations of how the above organizations have developed and used human capital measures and in the approach they used to producing their findings, which was very much in the action research mode.

Some of the key findings were as follows:

Few of the participating organizations used the term 'human capital', which was poorly understood, sometimes meaningless and sometimes offensive to managers.

Although there was some consensus over basic measures, there was no 'one-size-fits-all' approach or framework. Context mattered: while each organization felt they could learn from others, their was little possibility of developing a standard set of measures. This was most obvious in the differences between the private and public sectors, with the latter having to concern themselves with more intangible measures and more diverse stakeholders.

A 'workable' approach emerged during the course of the research workshops, fitting the needs of a majority of participants. This was the CAA's approach of asking a series a searching questions on what they wanted to know (e.g. are we retaining key employees?) and attaching a series of measures to each question, forming a four stage hierarchy - basic underpinning employee data, operational measures (e.g recruitment costs, training days), outcome measures (employee turnover) and 'strategic' measures, where the links were made between, say, absence and engagement. On this last series of measures, much more work was needed. We would suggest that this was particulalry true of the public sector, where intangible issues such as public value come into play.

In the cases, there is quite of bit of evidence of correlational work, though much less in the field of predictive measurement, which is our goal for the Scottish Government research. The most notable exception is RBS's well publicised and researched integrated human capital system.

In summary, this report is well worth the £18 investment for any practitioner or researcher. It is another example of good research/knowledge into practice from the IES, an organizations with which we are beginning to do a little bit of work . This starts with a 1-day conference on employer branding in Glasgow on November 4th, but more of this in a future post!

Friday, 22 August 2008

Leadership: What is it and Does it Matter in Healthcare?

I'm doing a presentation on leadership next week for the senior management team of NHS Greater Glasgow and Clyde, the largest health authority in the Scotland employing upwards of 40,000 people. This has caused me to think seriously about what I can usefully say - without being academically bland - to experienced people operating at a senior level on matters that can have extremely serious outcomes.

Like most management academics in these situations, I've chosen to do something which challenges the shibboleths of the 'leadership industry' from an evidence-based perspective and points to some useful things that leaders and leadership can achieve, again drawing on evidence rather than managerial cant. Some of this evidence is drawn from the provocatively titled and beautifully written books by Jeff Pfeffer and Robert Sutton on 'Hard Facts, Dangerous Half-Truths and Total Nonsense', Phil Rosenzweig on 'Eight Delusions that Deceive Managers', and Rakesh Khurana on 'The Irrational Question for the Charismatic CEO', with a of little Henry Mintzerg's 'Managers not MBAs' thrown in for good measure.

Other evidence, however, is taken from recent articles in journals or reports that most managers wouldn't pick up on. These include new material by Helen Dickinson and Chris Ham (2008) Engaging Doctors in Leadership', which can be found on the NHS Institute for Innovation and Improvement website at the bottom of this page; research into the importance of social capital; research into public value creation, including Mark Moore and Jean Hartley's (2008) paper 'Innovation in Governance' Public Management Review, 10, 1, 3-20; and two articles in the current issue of the British Journal of Management on something call 'top echelon theory', which deals with the impact of top management teams on performance (Patzelt, H., Zu Knyphausen-Aufseff, D. and Nikol, P., 2008, Top management teams, business models and performance of bio-technology ventures: an upper echelon perspective, British Journal of Management, 19, 3, 205-221; Naranjo-Gil, D., Hartmann, F. and Mass, V. S. (2008) Top management hetrogenity, strategic change and operational performance, British Journal of Management, 19,3, 222-234).

It's a real shame that these latter two articles weren't written with managers in mind because they have important practical things to say about what effective senior management teams in the healthcare sector need to take into account and need to become. However, I'm drawing readers, especially my postgraduate healthcare students, attention to these articles and to the other references because they are certainly worth reading, though some are more easily understood than others.

My storyline is as follows:

  1. that leaders matter a little less than the leadership industry would have you believe, especially in organizations that remain professional bureaucracies, dominated by doctors,
  2. that investment in followership and microsystems of distributed leadership in healthcare is key to effective performance, but they need to be connected to:
  3. diversely-constituted top management teams that both fit and shape innovative 'business models' or organizational architectures. These TMTs can be a positive force for strategic change in healthcare in ways that charismatic individuals can't. However, the composition of these teams matter a great deal because it determines their absoptive capacity to take in and exploit new knowledge. The diversity of these teams also matters because different people bring different things to the table and, equally importantly, diversity is also likely to reduce professional tribalism and motivate increasingly dissenchanted and/or sceptical clinicians to become more involved in the running of their organizations.

There may be little that's novel in this message, but I hope the evidence-base just about makes it credible.

Friday, 15 August 2008

Web 2.0, HR and the Long Tail

I've just come back from the Academy of Management (AOM) annual conference in Disney's 'smile factory' at Anaheim convinced of a couple of contradictory thoughts about that conference and Web 2.0. Now being something of a regular (this was my seventh stint in the last nine years) at what is the world's premier academic management event, I'm more convinced than ever that practitioners, consultants and non-attending academics in HR would benefit greatly from coming along. There is no doubt that the standard of papers and presentation of evidence-based HR (and any other topic on management) is higher than at any other academic or practitioner event I've attended; yet, there is a certain anti-intellectual bias, not in the sense of there being a lack of strong academic rigour but because there is too much focus on academic/scientific specialisation at the expense of big or innovative ideas and engagement of practitioners.

Nevertheless, if you can past the formulaic hypotheses testing, numerous discussions of regression and structural equation modelling, etc., by young academics looking to hit the top tier journals, most of whom have had few connections with practitioners, you can pick up many real chunks of insights that other conferences just won't give you.

One such paper dealt with the role of social network sites in hiring. Written by two not so young American academics, Donald Kluemper from Louisanna State University and Peter Rosen from Evansville University, this work was both rigorous and relevant. They argued that the use of social networking websites, like Facebook, has become extremely popular, particularly with
high school and college students in the US (interestingly more than half of the academics in the room had facebook sites). As a consequence, employers have begun to use the personal information available on social networking websites not only for recruitment, which we all know about, but also to make hiring decisions. Using ratings from 274 Facebook websites of students, this study assessed the validity of using Facebook to predict self-rated and other-rated
personality. Their data showed that Facebook ratings of Big-5 personality traits were correlated with each of the self-ratings of the Big-5 personality factors often used to predict performance at work: correlations ranged from .23 for neuroticism to .45 for extroversion, which in selection studies would be seen high. In a follow-up study of 54 employees, Facebook ratings were also shown to predict supervisor rated job performance and to show additional validity beyond self-rated personality in predicting supervisor ratings of job performance. In summary, Facebook entries can do a reasonable job of predicting the important personality characterisitics employers seek from potential employees without having to bring them in for assessment.

This study led to an interesting discussion of why this should be so, what employers can use Facebook and other sites for beyong recruitment and what happens when people wise up to the potential uses by employers of social networking, e.g. faking, impression management through competing over friends, etc. It also raised the issue of whether or not people will be left behind if they don't have a social networking site as recruiters week passive rather than active candidates.

So, here we have a paper that provided evidence on an important social phenomenon in a useful way, but will probably be read by only a few interested academics because practitioners don't tend to read academic journals (for good reason). So it was left to a guru to give me further food for thought and to provide some genuinely intellectual argument that will be read. On the journey back I picked up the new addition of Chris Anderson's recent reworking of 'The Longer, Long Tail' with a new chapter on marketing. Although we have used his ideas from the earlier book in our discussion paper for the CIPD, re-reading this book and the new material, showed the power of genuine insight and engagement with practitioners to present innovative issues in a rigorous fashion. His discussion of how the the the long tail of employees in Microsoft changed the way in which that company does business, despite the worries of lawyers and the brand police, showed the power of letting employee blogging rip. As he argues, ...Microsoft is a less monolithic company run by two titans, and more a collection of thousands of people pretty much like us. Whatever, Microsoft product you use..., there is an engineer or product manager carrying on a conversation in public about it.' (p 241). He also makes the point that Microsoft's customer and employer brand is now controlled by employee bloggers, and, what is more, they are relatively happy about this.

There is no doubt in my mind that social media will be more and more used by employees to give voice to their thoughts about their employers in ways that shed much more light on what matters to them than than through conventional attitude surveys. Some firms are beginning to recognise this, for example, IBM, which is one of our CIPD case study companies; perhaps others should begin to think about how the surface employee voice more innovatively.

If you want to participate in our CIPD study on Web 2.0, please go to CIPD website and look up the discussion under 'Helping People Learn'; if you are not a member, you can repond to this entry by going into the discussion listed on the side-bar.

Because there was so much at this conference of interest to readers of this blog, I'll take up a few more of the HR themes, such as the impact of HR and innovation and performance in forthcoming entries. I'll also examine the growing practitioner and academic interest on employer branding and corporate reputations, which was the subject of my paper.

Sunday, 3 August 2008

Employer Branding and Reputation Management in China and Glasgow's Supporting Role

In this week's Economist there are a number of stories highlighting the importance of branding and reputation management in China, some of it centred on the Olympics and some on the increasing need for Chinese companies to develop strategies based on branded goods and services that can be sold to the West. The available evidence also points to the need for many of the top Chinese companies to be able to compete more effectively in labour markets to attract and retain talented people to support branding strategies. So it comes as no surprise to see the establishment of a similar centre to our own being established in China, and we are pleased to announce that we have signed a memorandum of understanding to set up a co-branded Peking-Glasgow International Research Centre for Employer Brand and Reputation Management. This is to be based at Peking University, with Dr Hong Zhang (from Glasgow) and Professor Wang Hansheng from Peking University as co-directors. The relationship is to be strengthened by forming a partnership with the Zhaopin company, a leading Chinese recruitment consulting firm, and CCTV's China Best Employer Programme.

The aim of this new centre is to undertake research into employer branding and reputation management, and to examine the relationship between HR and branding. I will be helping launch the Centre with a presentation at Peking University in November of this year, and will be helping to put together an international conference on employer branding at Peking University in 2009.

We would be pleased to hear from anyone who may have something to contribute to this conference, so please take the time to email us with your ideas.

Thursday, 31 July 2008

Web 2.0: McKinsey Global Survey Results

The latest review by McKinsey, which can be downloaded from their website after registering, shows that Web 2.0 is becoming more popular with organizations in their now annual survey of nearly 2000 companies. Web services, blogs, RSS feeds and wikis are the most popular tools, with the main internal uses being to manage knowledge, foster collaboration, enhance the company culture and training. However, there is a wide variety of levels of satisfaction with Web 2.0 technologies, along with marked regional variations. Asia Pacific respondent were most satisfied with Web 2.0 with Latin American companies least satisfied. The main barriers to take up were that companies didn't understand the financial benefits, didn't have a supportive culture or sufficient incentives to experiment with Web 2.0. Its main HR impact seems to be that it has changed the way companies hire and retain people, though one has to question the way in which they addressed these issues. Interestingly, nearly half of respondents suggested that Web 2.0 had not changed the company nor the way it was organized. As one commentator suggested on our CIPD discussion space on Web 2.0 and HR, these findings are in line with our own preliminary thoughts in the field and with the CIPDs research on Web 2.0 and recruitment.

These surveys give an indication of what is happening, but respondents can only respond to the quality of questions asked. I'm not so sure these questions are as well constructed as they could be in the McKinsey survey. Any thoughts?

Tuesday, 29 July 2008

Employer Branding Link with Adcorp, Australia

Employer branding has largely been an American and European phenomenon, often associated with the needs for organizations to compete in the market for talent and to engage more fully the talent they have at their disposal. However, in our opinion this topic it is not well enough researched for practitioners; most of the current writing and case work is a little light on evaluation/ analysis and heavy on simple messages, 'silver bullets' or bullet points. Professional HR bodies such as the CIPD have been active in helping investigate this phenonenon more deeply, further evidenced by a recent call for research into the impact of mergers and acquisitions on employer branding.

There is even less written about this subject in an Asian context, however; though we have contributed to an Indian book on the subject and have recently signed a memorandum of agreement to set up a joint venture in China on employer branding and reputation management with a leading university, recruitment consultancy and TV channel (more on this development in a forthcoming blog).

So, given the Asian connections, and Australia's ambitions in this region, we are pleased to announce that we are working with Adcorp, a leading Australian employment communications agency, to run a series of one-day master classes, breakfast meetings and luncheons in Melbourne, Brisbane and Sydney between November 17th-21st of this year. These master classes will focus on strategic HR and its links with employer branding, corporate reputation management and leadership branding, and will draw on our recent case study research and our most recent publications in these fields.

Anyone interested in attending these events should contact Tim Grogan from Adcorp, who is leading this initiative.

Leadership and HR

Leadership and HR are rapidly becoming more intertwined, as our research into leadership branding is beginning to indicate. Human resource development has a key role to play in developing leaders in organizations, so HR professionals need to understand leadership theory, its promises and problems. At the same time, leadership of the HR function has become increasingly more important, yet needs to be better explained than the current vogue for HR competence frameworks are able to do. Currently we have a project on strategic leadership in HR that has produced a new framework for HR leaders, which we've written about in a recent conference paper and will be publishing in the near future. If you want a copy of the paper, just mail me on

Two very useful insights into the fields of leadership and HR leadership, which we will incorporate into our thinking, are discussed in a new special edition of the Leadership Journal (Vol 4, no. 3), edited by a colleague of mine, Dennis Tourish, and a brief, but timely, perspective on HR leadership by Pat Wright from Cornell in the current issue of Human Resource Executive Online. Both of these sources are well worth accessing.

Friday, 25 July 2008

HR, Social Networking and Blogging

Alongside the CIPD's website, one of the most useful site for HR practitioners to visit from an evidence-based practice perspective is the new social networking site for the HRM journal run by Theresa Welbourn. This site already has some interesting discussions going on but has greater potential to link practitioners to academic work than any other medium I'm currently aware of. This potential will be realised the more it is subscribed to and used by practitioners and academics, so please join.

The site already has a number of useful interest groups, including ones on networking, e-HR, HR in healthcare, teaching HR, HR in China, all subject areas of interest to my colleagues and I. In addition, there are a number of HR forums on issues such as ethics in HR, innovations in HR. You might also want to check out her leadership pulse site for some excellent tools and papers for practitioners and academics. This is related to, which explains/ debates the regular pulse surveys

Friday, 18 July 2008

Leadership Branding

Julie Hodges from Durham University and I are exploring the use of Ulrich and Smallwood's introduction of the term, 'leadership branding' into HR. For those not familiar with the notion, it focuses on how an organization wants to position its leadership and governance idenity with customers, investors, media and, importantly, employees. Julie has been exploring the use of leadership branding in a piece of action research with a major multinational and we are in the process of writing this work up for publication (suitably anonymised).

We are interested in hearing from anyone who has experience of leadership branding, either as having been involved in the design and implementation phase or as an employee? What was your experience? Or, it this just another brand extension too far?

Employer Branding

Judy Pate, Sheena Bell and Steve Ansell (all from Glasgow University Business School) and I are conducting a major exercise for NHS Scotland on employer branding and reputation management. This involves an examination of internal and external perceptions by different groups staff and potential employees of four NHS Boards in Scotland, which cover more than half of the population. We are using a mixture of group interviews and questionnaires to establish the extent of identification of people with the current employer brand(s) with a view to recommending changes in the design of the brand(s) and the HR and people management drivers of the brand. We hope to report on this project later on this year. However, anyone interested in these issues might want to look at a new survey and research report, entitled 'What matters to staff in the NHS' by Ipsos/Mori for the Department of Health, published in June 2008.

This work builds on recent ideas that colleagues and I have published for the CIPD and a book of our own (see side-bar) and in chapters in two forthcoming books on HR by Paul Sparrow on international HR and by Cary Cooper and Ron Burke on High Performance Organizations due out later this year.

In February, we presented at a conference on 'Employer Branding and Employee Voice' run by the London School of Economics and the CIPD. At that conference, a panel made up of employers were largely sceptical of the notion of branding as it applies to HR practice. We were quite surprised but would enjoy hearing from practitioners one way or another. We are particularly interested in any work that has been done to evaluate the effectiveness of employer branding on either improved recruitment or on improvements in employee identification or engagement with organizations.

Measuring Human Capital

Stacey Bushfield and I are investigating ways of measuring the impact of human capital investment in public services as part of a project funded by the Scottish Government and ESRC. Currently we are at the stage of producing a literature review on the topic but are still searching for new material and insights into this problem. Has anyone come across or developed interesting ideas that you are willing to share with us? In return, we would be happy to send you our review.

The work done so far is a systematic review of most of what has been written on human capital and its relationships with social capital, organizational capital and innovation. This is linked to a discussion of public value and client outcomes from public services, an important topic in public sector management.

The next stage of the exercise is to investigate how public services currently measure their investments in human capital. Judging from our preliminary work, there is little evidence of predictive measures of the kind, 'to what extent does investment in, say, leadership development, pay-off in key outcomes measures' and the timing of any returns. If anyone has come across any examples of predictive measures of this kind, we would be pleased to hear about them and exchange ideas.

Thursday, 17 July 2008

Web 2.0 and HR

Martin Reddington, Mary Beth Kneafsey and I have recently produced a Research Insight document for the CIPD on Web 2.0 and HR as part of their 'Shaping the Future' agenda. This can be found at the CIPD's website, which we encourage members of the CIPD to visit and participate in the online discussion . Other people who are not members of the CIPD can contribute by joining our discussion forum/ resource space, which is also listed on the side bar. We are looking for feedback on the issues we raise in the document. These focus on the potential advantages (and some of the problems) of social media in helping organizations become more effective in recruiting, engaging staff, allowing greater individualisation of psychological contracts and encouraging collaboration to increase the organization's collective IQ.

The questions we would like readers to share their thoughts with us are:
  1. Are these social media - for example, blogs, wikis, social networking sites, image sharing sites, virtual worlds, etc., - like to be 'disruptive innovations' for people management, and thus likely to help create sustainable high performance organizations? Or are they part of the technology hype?
  2. Does the HR function need to be where the net or virtual generation communicate to reach them? Or is the net generation too general a term so as to be misleading?
  3. Can these technologies be used to enhance employee voice/engagement and the extended IQ or the organizations, or are their better ways of achieving these ends?
  4. To what extent is the HR community up to speed with these innovations, and do they need to be?
  5. To what extent does Web 2.0/social networking represent a threat to HR's desire to control?

Please take some time out to record your thoughts on these questions, either on the CIPD website or this blog. On this topic, you might also want to visit James Richards blog, 'Work-related blogs and news', for an expert, evidence-based insight into one of the most important social media technologies. John Castledine's blog has an excellent introduction to Enterprise 2.0, while Jon Ingham's Human Capital Management and Ross Dawson's 'Living Networks' are also highly informative on Web and Enterprise 2.0