organisational resilience at nz post prof. jim arrowsmith

Organisational resilience at NZ Post

Prof. Jim Arrowsmith

Te Kunengaki PūrehuroaCreating leaders. Transforming business.

Resilience

• The ability to cope with, and recover from, adversity or traumatic change

• In organisations, traditionally involves risk and response planning for physical threats

• But increasingly understood in terms of managing major change and restructuring

It is not the strongest of the species that

survive, nor the most intelligent, but the most responsive to

change


• One of the country’s oldest, largest and most familiar organisations

• SOE since 1987: legislated to act- commercially, ‘as a successful business ... as profitable and efficient as

comparable businesses that are not owned by the Crown’- as a ‘good employer’, with personnel policies and practices ‘necessary

for the fair and proper treatment of employees in all aspects of their employment’

Negotiated change, sustained profitability, though 90s and beyond

The need for resilience at NZ Post


• Deregulation and competition• Internet: electronic transfer

- rapidly falling volume (-7.5% p.a.)

- diverse items: more difficult and expensive to deliver

• Increased delivery points- over past decade, now delivers a fifth less volume to a third more addresses

• Group profits -29% FY2013 (to $121m) - sustained by courier business and, especially, KiwiBank (net profit $97m)

- losing $30m p.a. from its store network

- letters business breaking even but forecast loss $25m in 5 years

Accelerating crisis


• Stores- rationalisation (to minimum 880 under ‘Deed of Understanding’)- refurbishment (flagship Kiwibank)- self-service technology

• Delivery- labour intensive business (70% cost)- new postcode and investment in sorting machinery in the 6 conurbations- further centralise processing capacity

close Hamilton. Wellington, Dunedinexpand Auckland, Manawatu, Christchurch

- revise DoU to reduce delivery days from 6 to 3

‘Hardware’ response


• HR strategy: ‘Creating a High Performance Culture’ - ‘creating a world class operational environment’- ‘developing high-performing leaders’- ‘building a highly engaged workforce’

• Focus on frontline leadership:- TL role: match staff to volumes; deal with employee relations issues; manage

performance - deficiencies identified by BSC data; succession planning analysis; EPMU

• Aim to improve TL (and thereby staff)- engagement (motivation, commitment)- performance (ability to translate this into behaviours)

- resilience (open to/ leading through change)

‘Software’ response


• GOAL(‘Great Operations and Leadership’): more than usual training solution:- theoretically informed (AMO theory)- wide scope, including job analysis and design- research based (TL interviews, focus groups, anonymous survey)

• Research found problems in each area- ability = communication skills and modelling appropriate behaviour; operating the

performance management system; in work planning and technical knowledge- motivation = most wanted to perform well, but saw their job as difficult, stressful

and not valued as part of the management team- opportunity = limited by a wide range of accountabilities, unclear reporting lines,

large team size, drawn into administration or assisting workers in their tasks- direction = weakened by unfocused performance measures and inconsistent

consequences for those consistently failing to meet objectives


• GOAL:- systematic recruitment; succession planning; mentoring...- job redesign and new Delivery Support role

• DTLs: focus on people management and work planning- daily contact with team members (limited workplace time)

- quarterly ‘performance and development discussions’- budgetary responsibility

• But other changes ongoing (BSC, branch amalgamations, pay scheme): senior management feared GOAL could be costly and disruptive- ‘some in the business were passionate supporters, some were against and there were

a lot in the middle waiting to see who won the battle’ (HR)


‘you can’t bank engagement!’

‘yeah, well, show me the money. All I can see is that you’re changing

the structure, you’re adding in cost’

HR Strategy(a) joint partnership between HR and Delivery

Business(b) pilot initiatives to demonstrate value


• Formed by amalgamation of 5 branches in October 2006- largest in NZ: familiarisation problems; culture differences

• GOAL added to TL stress - early atmosphere ‘toxic’ (branch manager) with ‘low engagement’ (HR)

• HR consultant embedded• weekly staff focus groups to identify and resolve concerns• ongoing informal meetings with staff, TLs and union reps• emphasis on relationship building

• Improvements over time• TLs felt job enriched: more interesting, better relations with management

and staff• Posties saw better leadership and support from TLs, and more consistent

approach to managing performance

The Marua Road story


Postie survey: How does Marua compare with previous branches?

Same (%) Better (%)

Communication 27 73

Teamwork 33 40

Development opportunities 73 14

Awareness of business results 20 80

Individual support 27 67

Access to team leader 47 53

As a place to work 33 40

Decrease

Overtime = 50%

Unit costs = 12%

Complaints = 47%

Absence = 46%

Increase

Productivity = 16%

Engagement= overall mean score from 3.6 to 4.1

Better communication, performance management

Better employee relations

Business Impact Review


“GOAL has been instrumental in taking Marua Road from a dysfunctional amalgamation of five poorly performing delivery branches to a cohesive, best practice site where staff at all levels are engaged and performing effectively”

(Regional Delivery Business Leader)

Result: National rollout signed off


• Maintaining employee commitment and performance in tough times and through change requires building up resilience

“Our front line operational leaders are continually managing change to ensure the performance of the branch and their people to meet the challenges of increasing costs and declining mail volumes.

Inevitably the future will bring more fundamental change to the business model and our front line leaders need to be able to manage the performance and engagement of their people through more significant change.

This requires resilience at the organisational and personal level and the GOAL programme and other initiatives are all part of this”

Chris Fitzgerald, Business Improvement Leader

Conclusions


NZ Post shows how this can be done HR needs to understand the business thoroughly and be prepared to propose and lead

initiatives- build alliances

- evidence-based change a commitment to ‘employee advocacy’: identifying and acting on concerns

- inclusive of staff and their representatives

“It is not enough for HR professionals to be credible, they must also have a point of view on how to influence the business”

“HR matters most under conditions of change” Brockbank and Ulrich, 2009


• Building and sustaining employee resilience requires HR to ‘ask the harder questions’ so that employees are involved and not disengaged- why is there not supportive leadership?- why are they frustrated in their work? - why don’t employees trust management?

• Cautious note: building engagement and resilience is an ongoing process that commits all the actors to a continuous interrogation of the workplace and employment relationships- last visit to Marua Rd: resource constraints and increasing workload (eg transfer of

courier work) ‘crowding out’ some of the valued time for people management

- so far all good, but will this erode goodwill and resilience for the Next Big Change?!

organisational resilience at nz post prof. jim arrowsmith

Documents

te kunenga ki prehuroa

successful business

courier business

change software response

nz post slide

hardware response slide

response planning

jim arrowsmith slide