These are complex corporate times but as the finger of blame for the global economic downturn is pointed at various external stakeholders like the regulators and even the customers themselves, it’s interesting to hear the term “corporate culture” finally surfacing in banking post mortems.

 

The term performance culture has been increasingly abused within performance management parlance.  It has become inextricably linked with the drive for delivering shareholder value in quarterly increments and the “up or out” mentality which has spilled over from investment banking.

 

But now that almost every investment banking super-tanker has holed itself on the reefs of greed, selfishness, arrogance and some fairly suspect practice it’s time to reclaim the phrase. This is why leaders like RBS’s Stephen Hester are now having to open internal moratoriums in an attempt to bridge the obvious and growing employee engagement gap that has opened up within some of our high profile financial services names.

 

Ironically, despite this being an employer’s market, employee engagement; employer brand and corporate culture have never been so important. But it’s time for a fundamental re-think about how internal stakeholders (employees) are managed. The infrastructure underpinning many employment brands is clearly in need of a dramatic overhaul. And this is no job for the marketing function or advertising types.

 

Clearly characteristics like sustainability, network building and relationship development are the bedfellows of integrity, accountability, security and trust (the values, ironically, most popularly used to market the wares of financial services companies). But how can these values flourish when FS employees have seen HR functions replaced by processes and help lines; when average employee tenure (and loyalty) has fallen so dramatically and when  effective performance management and feedback loops have been replaced by grievance processes and whistle blowing – the corporate equivalent of “ratting on your colleagues”

 

I’m certainly not calling for a complete return to the cosy old hierarchies; glass ceilings and command and control regimes. But it’s clear that there’s going to have to be a large dose of mature, “back to the future” relationship based thinking if the nirvana of an appropriate and authentic performance culture is ever going to be achieved by arguably our most influential businesses and brands. And if the last 18 months has taught us anything it’s that none of us can afford for our financial services brands to continue to fail their employees by making promises to customers and the market that they simply can’t keep.

Ian

 

 

 

The importance of managing employee perceptions has given rise to the contemporary notion of Employer Brand.  This is essentially the brand the employer projects to existing and potential employees via the chain of communication touch points ranging from recruitment intermediaries through to line managers. 

I believe, however, that by focusing on Employer Brand, the HR community runs the risk of become obsessed with only half the story. If we accept that a brand is simply a set of promises unless people keep those promises then a more accurate and effective descriptor for this aspect of internal brand management is Employment Brand.  This reflects the difference between the espoused or promised brand and actual experience and points to the importance of culture management.

As the employer brand tends to fall within the remit of the people-centred functions (usually HR) and the brand projected to customers remains ring-fenced by the Marketing functions, the seeds are sown for brand warfare perpetuating multiple value sets, confused behaviours and creeping brand death if the situation persists.  This internal brand warfare is rife across sectors and undermines the effectiveness of the brand management process.  One of the battalions critical to the outcome of this war is the internal communication function. The brand projected by this function will largely be reliant upon the reporting line of this function.  Research indicates (see Buckingham, Brand Engagement www.palgrave.com/products/title.aspx?PID=281268 ) that HR may well be winning this particular war as HR functions are increasingly adopting Internal Communication within their remit.

This trend towards HR dominated internal communication is exposing effective brand management to increasing risk of failure however because:

1. HR budgets for internal communication and employee engagement are largely discretionary and are very exposed when the balance sheet comes under threat
2. HR functions have a habit of perpetuating additional value sets and complex behavioural matrices than those espoused by their marketing counterparts which can lead to duplication, complication, confusion and behaviour that is not “on brand”
3. Internal communication should be regarded as a professional discipline in its own right.  It is not internal marketing and PR and is not employee consultation nor is it message management.

The most obvious answer is to encourage more effective partnerships between HR and Marketing and to professionalize internal communication in the interest of managing the brand from both the internal and external perspective.

Largely as a consequence of the scenario detailed, employee communication tends to be project based and tactical, cascaded or marketing-think applied to the internal market.  Written communication dominates whereas face to face communication via line managers is proven, time and again, to be the most effective communication.  Employee engagement can’t be conscripted, cascaded or aligned however tricky the internal marketing process.  It has to be developed from the ground upwards and packaged in a manner that is appropriate to the culture of the organisation in question.  It must also role model the aspirational brand values. 

Consider many financial service brands as a case in point.  Reflect on how many FS brands project brand values like integrity, trust, heritage, customer service and professionalism?  Employees understand that this is a marketing stance. Too many however, also understand that the prevailing internal culture is increasingly characterised by winning, eliminating competition, survival of the fittest and short-termism.  Internal brand alignment activity which does not acknowledge the current culture and is therefore inauthentic is a waste of money at best.  It is interesting to note that the UK Prime Minister, Gordon Brown, has recently announced a pending package of protectionist measures geared towards encouraging medium to long term thinking within the FS markets and to address iniquities in the reward structures of many financial services organisations. The provocative question is that if they were actually living the brands they espouse would this intervention be necessary?   He is simply acknowledging what employees have known for years (and many customers), that the brand values projected belie the internal culture.  When that happens for long enough it gives rise to brand disasters on the scale we’ve seen recently which many critics have foreseen for some time.

The answer to this brand challenge has to be to unite the internal and external facing brand custodians to develop a holistic engagement programme which is appropriate to both markets.  It must, however, be based upon a sound and clear business case and appropriately funded as a “must have” rather than “nice to have”. I also believe that the key facilitator should be the CEO and that accountability for the success of the holistic brand management programme should be focused on the medium rather than short term which will prevent money being wasted on Big Bang engagement initiatives which are a welcome diversion from normality but rarely work. I believe that there is a route-map of key principles underpinning experience based employee brand engagement but no one size fits all packageable approach.

Food for thought?

Ian

These are complex corporate times but as the fingers of blame for the global economic downturn have been pointed at various external stakeholders, it’s interesting to hear the term “culture” creeping into the post mortem about the banking sector.

 

I’ve become increasingly fascinated by the growing abuse of the term performance culture within performance management parlance.  For me this phrase has become inextricably linked with the drive for delivering shareholder value in quarterly increments and the “up or out” mentality which has spilled over from investment banking.

 

But where does this leave the zealots now that a number of the investment banking super-tankers have holed themselves on the reefs of greed, selfishness, arrogance and some fairly suspect practice? It’s time for a fundamental re-think. The infrastructure underpinning many employment brands is clearly in need of a dramatic overhaul.

 

The current witch hunt for high profile scapegoats amongst the executive leadership cadre may “give good headline” but this sideshow threatens to distract from the core issues. Controversially I would go so far as to suggest that the culture problem is a widespread issue every bit as serious as the accusations of systemic racism levelled at the police force back in the 90s. Arguably this crisis will have even more far reaching consequences.

 

Far from being advocates of what have often been derided as “nice to have” initiatives, in these tough times, organisation development should be prioritised as part of the recovery process and OD professionals should be leading the revolutionary line. The time has come for comprehensive internal reviews followed by an energetic re-positioning of the vision, mission and values and associated people processes within many of our leading brand names.  This should be the first step towards a re-framing of the definition of performance in the context of the employer or employment brand

 

This is a complex issue but consider for a second the long established theory that an individual is at their most effective within a role some 2.5 years into the job. Or reflect on the equally established best practice that leaders should spend most of their first 100 days listening and gathering information. Contrast this with the notion of “hitting the ground running” and the obsession with quarterly shareholder reporting and year on year incremental targeting regardless of conditions. Mixed messages?

 

It seems a little old fashioned in these high octane times but there’s sound logic underpinning leadership best practices which call for considered, well paced decision making based upon an understanding that the decision makers will still be around when the impact of their decisions come to fruition.

 

Bankers, for example, used to be remunerated on the basis of loyalty bonuses and benefits packages at preferential rates.  Not so long ago, any posting on a c.v. revealing tenure in a role of under three years was viewed with suspicion.  Lift the drains on the recent recruitment drive amongst the retail banking sector and you will be greeted by whole teams made up of job-hopping former investment bankers.

 

Of course the flipside of low employee turnover includes problems with innovation, pace and inertia. But inertia and stability are two very different things.  The latter was once a highly prized commodity even in important parts of the investment market but was derided by the “short termists”. What wouldn’t shareholders now give for even incremental returns on their investments?

 

Those in the know suggest that many of the high profile leaders who will be appearing in committees over the next few months have been off the record advocates of culling grey hair in their staff ranks.  What price wisdom now?

 

Don’t get me wrong.  I very much believe in the notion of a culture of performance.  That’s why we’re all in business after all.  I just don’t believe in the notion of winning at all costs.

 

I’m realistic enough to understand that sustainability, network building and relationship development are the bedfellows of integrity, accountability, security and trust (the values, ironically, most popularly used to advertise the wares of financial services companies). I’m certainly not calling for a complete return to the old hierarchies and command and control regimes but it’s clear that there’s going to have to be a large dose of mature,“back to the future” thinking if the nirvana of an appropriate and  authentic performance culture is ever going to be achieved by arguably our most influential businesses and brands.

 

Ian@by2w.co.uk

 

Ian is the author of Brand Engagement: How Employees Make or Break Brands

 www.palgrave.com/products/title.aspx?PID=281268