Sunday, July 01, 2012

Sunday Essay - untangling the real meaning of new ways of working

I finished my last post, Saturday Morning Musings - half lives and New Ways of Working, in this way:

We talk about the need for management and people flexibility in that most basic area, secure employment. We say that a young person will follow multiple career paths in their lives. Yet we do nothing to address the most basic questions: how might this actually work? How do we create a world that might provide the desired business and personal flexibility? How do we give people a degree of certainty about their own lives in an unstable world?

I suppose that this is the first part of my charge. We have failed.

The second part lies in our failure to address to actually recognise the implications of what we do. I will hold this one to my next post.  

In comments, Augustus disagreed with me strongly. He said in part: "“News Ways of Working” is not a new concept. And much has been written about it. Google it and you will see what I mean. There are many different themes on this but one common factor is that it appears in most cases to be an aspirational document."

For his part, Ramana suggested that he had a different perception on this. "All the young people I know who are now in the work force," he wrote, "seem to manage very well with turbulence....I think that they are quite capable of finding their way through by trial and error just as we did when we were young. It does no good for us to worry, just as it did no good for our parents to. I would call it a memory gap."

Winton Bates then said in a post on his blog:

The forces of globalization are likely to subject an increasing proportion of occupations, including some occupations requiring substantial skills, to increased international competition. It is also possible that technological progress will impact unevenly in ways that benefit some groups (e.g. successful innovators, owners of robots) and disadvantage others (e.g. those whose skills are becoming redundant). If that happens, expressions of collective guilt/responsibility, like this one by Jim Belshaw on his blog yesterday, are likely to become more common.

Winton followed this by quoting the first paragraph in the excerpt I gave above. He continued:

It seems likely that governments in high-income countries will come under increasing pressure to provide people with a greater degree of economic security. If we are to avoid a return of protectionism – protecting  existing jobs at the expense of new job opportunities - more adjustment assistance may need to be provided. This could involve more government assistance for retraining of people whose skills are becoming redundant and the broadening social welfare safety nets that are already coming under increasing stress as a result more predictable developments such as the rising age structure of populations.

I will respond to their comments in the discussion thread on on my previous post. However, reading them made me realise that I need to clarify my present focus. You see, I have written a fair bit around the question of the changing way we organise life and work from a personal as well as professional perspective. Sometimes I have written as an economist, sometimes as an historian, sometimes as a social analyst, sometimes as a person personally affected by change processes.

What I write and the way I write it is affected by the perspective adopted: sometimes I am deeply pessimistic, at other times, optimistic; sometimes I write objectively, at other times I campaign for change. It all depends on the circumstances.

In the case of the present discussion, my focus is a little different from the interpretations placed upon it, although I see how those interpretations might have arisen.  

Genesis of New Ways of Working

As Augustus noted, a google search shows that the term "new ways of working" is now quite widespread. Further, it often does have aspirational elements, linking to changing popular themes such as sustainability.

My focus is much narrower, much simpler. It starts from a simple premise, that there has been a fundamental change in the relationships between people and the organisations that employ them. Accepting that premise, I then ask two basic questions: what does it mean for people and organisations; and how might work and work related arrangements be restructured to accommodate the changes?

I have written before about my experiences as, in one of those classic examples of management speak, an outplacement consultant. In Australia, the last part of the 1980s and the nineties was a period of fundamental economic restructuring that saw the effective ending of the concept of the "permanent" job, of life long employment. The focus at the time was on economic restructuring, on the need to improve economic efficiency. The changes took place against a background of recession.

In structural terms, the economic changes created three overlapping pools of disadvantage, among the young, the older worker and the unskilled. The concept of an underclass had been alien to the Australian experience. Ten years later it would become a matter of considerable social concern.

In psychological terms, part of the effects were captured in the title of Don Aitkin's study of the 1953 leaving certificate class of 1953, "What was it all for?" Most of that group took early retirement. They all welcomed aspects of the changes that had taken place in Australia, but were left with a sense of unease about the overall pattern of change.

This was an older group that had grown up in a world of secure employment and generally had secure superannuation that allowed them to exit stage left. Younger workers were faced by a more fundamental challenge. "You have entered a world", they were told, "of constant change. Your employer needs flexible working arrangements. You have to be responsible for your own career."

In all this, nobody really asked the question of what this might mean for the future of work, for the relationship between employer and employee. Okay, you are telling us this, but what happens if we actually do this, if we regard our job as just a stepping stone to the next stage, if we place our personal needs in front of yours, if we treat what we do now as just a short term relationship? What do you, the employer, do now?

These are very basic questions. Employers of all types are in competition for staff. They need people, and they want the best people they can get. How do you compete in a market place for people where your prospective staff have absorbed the message that you collectively have been giving? How do you hold those you want? How do you get staff to go the extra mile that you need? How do you maintain loyalty in a short term world?

In most cases, the answer adopted came back to money, to payments for performance as defined. I did not and do not find this satisfactory.

I had been mulling over these questions. In 1998 I moved from consulting to become CEO of the Royal Australian College of Ophthalmologists and tried to put the conclusions I had reached into effect. The approach I adopted was simple and based on just two premises:

  • Peoples' needs varied. There was no single answer. The single most important thing was good work within the constraints set by individual circumstance.
  • Given the constraints set by individual circumstances, the next most important thing that we could do for our staff was to ensure that they were more employable when they left than they had been when they joined us. We were just a stage in their journey, not an end in itself. 

We carried this simple philosophy through into our offers of employment and in performance appraisal systems.

Most current performance appraisal systems are far too complicated and bureaucratic.  Entire tomes are written on their design. Ours were very simple. Focused on both management and staff needs, the quarterly reports rarely exceed two pages and provided a simple record of joint progress. There were no rankings, no records of specific organisational things achieved, just a simple record of progress, of identified problems with some new joint targets combining personal and organisational.

Importantly, there was no connection between appraisal and pay, nor was there any system of central recording. The appraisals were simply a management tool focused on performance improvement at personal and business level.

Subsequent Developments

In period immediately after I left the College to move back to consulting, I and my colleagues tried to generalise the lessons learned into a new service area helping organisations introduce new staff management approaches centred on new ways of working. In my last post I indicated that we did not have the resources to make the new approach properly saleable. That was true but, as is often the case, there was a little more to it than that.

One of the most difficult things that I have found as a management consultant is to get clients to properly understand the differences between "hard" and "soft". Most business people are pretty pragmatic. They have to be. This means that they tend to focus on the immediately measurable.

I saw the effects of this during the 1990s' recession. Statistically, the recession bottomed in the middle of 1991. In the consulting area, the collapse happened earlier. The Australian national marketplace for consulting and training services contracted by no less than a third in the first months of 1990. The only growth areas lay in advice on cost reduction and then outplacement. 

In talking to clients then and later, we found it extremely difficult to get across the message that "soft" approaches would yield real longer term paybacks. This my sound academic, so let me explain.

"Hard" approaches centre on the immediate. Get this cost reduction now, achieve that thing now. By contrast, our approach required clients to focus on process, to understand that the longer term growth of the business required them to put aside immediate measurement to focus on things that would yield gains over time even if the results could not be immediately measured.

This probably still sounds academic, so let me focus on you as a staff member. In one model, you have a series of concrete defined things that must be achieved now. Just get those, and you don't have to worry about anything else. You are protected. As one manager explained to me, the work plans protect you. Just do your job, get on with it. It doesn't matter whether or not the defined action items are impractical. Do what you can, meet output requirements, document and then failure is someone else's problem. There is no requirement in this world for personal improvement, for doing more.

By contrast, our proposed approach centred on improvement, improvement for the individual, improvement for the organisation, broken up into concrete discrete steps. Both sides had to take responsibility. Which would you as a staff member find harder?

The long boom that began in the 1990s took the immediate need for fundamental change away. However, the inexorable process of change continued. Organisations and especially those in the private sector learned that they had to protect their staff. Whereas in the early 1990s organisations shed staff like confetti in the face of recession and in the name of cost cutting and process re-engineering, the Global Financial Crisis saw Australian business attempt to retain their people by adopting alternative measures such as reduced working hours. That's a huge change, one that reflects changing market realities.

You see, people have learned to protect themselves, to place their own interests first. Further, the processes of social change mean that personal interests have changed. The organisation, the body that once formed the career centre, no longer counts. Of course people still care, but they now have no expectation that the place in which they work today will be the place in which they work tomorrow. Career, family, personal development, all the aspects of human life, have changed in fundamental ways. Who you work for now is just a step to a still unknown future. You owe loyalty to your employer, but that loyalty is set within strict bounds.

Change is always progressive and partial. The people who have benefited from the latest changes are those with greatest salability. To some degree, the ordinary person has been left behind.


I have barely begun begun to sketch the overall implications of the process now underway. I do hope, however, that I have given you some indication of my position, that you begin to see the scale of the next transformation that will affect the world of work and society more broadly.          


Evan said...

Hi Jim, I hope you sketch out more of this. It is a hugely important area that gets so little attention.

It would be interesting to see if individuals could form groups of mutual support - a new version of friendly societies? - where individuals contributed to employment insurance for each other and ther benefits.

I don't see the corporates ever valuing individuals and their contribution.

One example of a low turnover company is Ricardo Semler's. It would be possible to study companies like his and get a sense of a new way of working. I'm sure this will have been done in academia somewhere. You would know better than me.

Rummuser said...

Jim, coming as I do from a highly committed HRD background, I despair at what what is now called HRD in most organisations. Inevitably, the department is simply called so but they remain the old Personnel department focused on what suits the management best. Treating employees as long term resources is simply not in any one's agenda in a business atmosphere driven by quarterly performances. I have personal experience of such shabby approaches and I keep getting information from younger people that nothing has improved since my retirement. There are a few companies who do follow remarkably enlightened HR practices but they are the exception.

The work force has therefore willy-nilly accepted the fact of life and adapted. Since being employed is preferable to being unemployed, new employment methods like contract labour have gained acceptance and the declining clout of labour unions have added to the despair of progressive elements of the society.

I of course speak for India but I will be very surprised if other countries also do not present the same scenario.

(I shall send by separate mail an explanation of "Contract Labour".)

Evan, what you suggest is to say the least, utopian. The trade union movement was meant exactly for that purpose, but over the last three or four decades, bar Germany, Capital has gained the upper most hand in all economic activity and what Jim despairs about is precisely due to this.

Anonymous said...

Jim, have to admit I'm struggling with this and the last post. From my (decidedly) small business background I've had to face the inevitability of change - both as to the continuing business, and to totally different directions - a few times.

The problems you are describing seem to me more directed to those who have employment in larger organisations. Anyway, I shall continue reading with interest, as they say.


Jim Belshaw said...

Starting with the last comment first, you are right kvd in concluding that my comments I have a special focus on larger organisations. I should balance that a little.

Ramana, your comments on HRD ring fairly true from my experience. You can add to it the increasing need for HRDs to deal with compliance issues. I don't object to all of this, it's more the way it's done. You can also add the impact of computer systems themselves and the way they affect the delivery of the human resource function.

I agree with you that people adjust. Indeed, that was one point we tried to make in our marketing of the NWofW concept. People had adjusted, and employers themselves had to adjust as a consequence. Those who sow the wind etc.

In fact, organisations have begun to adjust. Just, and this is an Australian comment, compare the different approaches to people during the earlier Australian recession and that during the GFC. My argument is that neither employers nor indeed employees have yet fully realized just what it all means.

Evan, I haven't researched the academic material in the way I should.

Anonymous said...

Well Jim, I read a subsequent post which seemed to caste aspersions upon dogs (joking!) and went away to think about it before commenting, then returned to find the dogs are missing...

We live in unstable times.


Jim Belshaw said...

We do in indeed, kvd! Your comment made me put up an explanatory post.