Thriving organizations around the world are finding that one of the significant components to their success is building workforce excellence across cultures and job roles. The key ingredient? Outstanding human resources management. Det Norske Veritas (DNV), a global risk management firm based in Oslo, Norway, places emphasis on showing respect starting with the recruiting process. Club Mediterranée, a resort operator based in Paris, France, believes that the employee experience determines the customer experience. Mumbai-based IDBI, formerly known as the Industrial Development Bank of India, focuses on leveraging quality human capital and allowing employees to develop new ideas. There are commonalities among these very diverse organizations. All three believe in providing excellent employee training and opportunities for employee growth. In addition, these firms support human resources operations with efficient and effective IT systems. DNV, which has 300 offices in 100 countries, selected PeopleSoft to implement a common infrastructure to keep its culture cohesive and to maximize efficiency. Club Med developed its human resources information system so that it has a single instance in place throughout its 100 resort villages. The company relies on a consistent performance evaluation process with all data held in its Oracle Database. IDBI, which has a 95-city branch network and 4,400 employees, offers a strong IT system that lets personnel spend time on banking instead of on paperwork.

As Published In February 2006

Striving Toward Excellence
By Ann C. Logue

Building workforce excellence across cultures and job roles

The modern office is the setting for bitter mock-reality television shows, depressingly funny cartoons, and fights over red staplers. And yet, every day, people get up and go to work, knowing that they are able to make a difference and build their own careers. To them, "Dilbert" is just a cartoon strip. Organizations around the world are creating great places for smart people to do great work.

Susan Lucia Annunzio, an expert on work group performance, has found four distinguishing characteristics of high-performing teams within organizations: They value people, specifically by treating smart people like smart people; they optimize critical thinking by putting their stated values into practice; they give employees the latitude to seize opportunities; and they retain great employees by allowing people to make a difference in the way business takes place. "When people are put together, they have to be put together in a context that engages their brains rather than their emotions," she says.

Despite diverse customers, diverse colleagues, and instant messengers beeping in the background, companies around the world get the job done. The secret? Excellent human resources management. Whether financing infrastructure projects, rating the seaworthiness of a ship, or entertaining vacationers, high-performance organizations share common values that help them attract and retain people who can build their business. Profit talked to several human resources executives to find out what works in their organizations.

Valuing People

At Det Norske Veritas (DNV), a global risk management firm based in Oslo, Norway, showing respect begins in the recruiting process. "We're competency-based," says Helene Berge Holm, head of the company's corporate human resources management system. "That's the only thing we sell: brainpower." DNV's hiring managers understand that they can't hire everyone and that many of those they hire and train will leave for jobs elsewhere. But they also understand that many of those people will take jobs with current or potential clients. "If we treat them well, they will become our ambassadors later on," Berge Holm says.

A culture that views even rejected applicants and exiting employees as assets flies in the face of workplace cynicism. Workers see "people are our most important asset" in mission statements, but they rarely see it bolstered by active leadership. By contrast, managers of high-performing work groups live that statement, by creating environments in which people can do their best work.

At Club Mediterranée (Club Med), a resort operator based in Paris, France, even if current and prospective employees never become customers, the employee experience determines the customer experience. Its resorts offer a full range of planned activities, so a large part of guests' experience is based on interaction with the staff. "We want people who are really remarkable, whom you really remember," says Frédéric Tarkowski, who is in charge of human resources administration and compensation for the company. All titles start with the word gentil, or nice; whether serving drinks or maintaining servers in the IT department, a Club Med staffer is known to all as a "gentil organisateur" (commonly known as GO), or "nice organizer." (Guests at Club Med resorts hold the title of "gentil membre" [GM].)

It's no surprise that in its recruiting, Club Med screens for personality as well as personal ability. "Our culture is really strong," says Tarkowski. "If you are a shy person, it cannot work." But it also screens for sensitivity. Cultural diversity is part and parcel of the Club Med experience; GOs come from more than 80 countries and speak more than 30 languages. A Club Med village in Mexico may have a French national with an Israeli supervisor teaching tennis to Anglophone Canadians. Having a multinational staff "is a way for us to give a richer experience to our customers," Tarkowski explains. Village staff members live together during the season, so they have to be open-minded and flexible.

Transparency Drives Success

Snapshot Det Norske Veritas www.dnv.com Business: Risk management for the transportation, logistics, and energy industries Location: Oslo, Norway Revenue: US$900 million Number of employees: 6,400 Oracle products and services: PeopleSoft Enterprise Human Capital Management 8.8, including eRecruit, eRecruit Manager Desktop, eCompensation, eProfile, eProfile Manager Desktop, eDevelopment, and Directory Interface Club Mediterranée www.clubmed.com Business: All-inclusive vacations at resort villages around the world Location: Paris, France Revenue: US$1.6 billion Number of employees: 19,000 Oracle products and services: Oracle Financials 11.0 and PeopleSoft Enterprise Human Capital Management 8.3 IDBI Bank www.idbibank.com Business: Development, commercial, and retail banking Location: Mumbai, India Assets: US$19 billion Number of employees: 4,400 Oracle products and services: Oracle Database, including Oracle Partitioning; Oracle Application Server; Oracle Developer Suite; Oracle E-Business Suite, including Financials, Cash Management, Financial Analyzer, Sales Analyzer, Treasury, Human Resources, and iLearning

Employees want to work at places where their efforts will be valued. Mumbai-based IDBI Limited is able to attract talent from India's top universities because of its record of success. "It's one of the institutions that has contributed to the phenomenal industrial development of this country," says O.V. Bundellu, executive director of the bank's human resources group. Nevertheless, the bank's recruiting and retention strategy relies on more than just the bank's accomplishments. One of IDBI's core values is to leverage quality human capital. The company's human resources information system promotes transparency, which demonstrates that the institution respects employees, Bundellu explains. "It is all based on merit," he says. Employees know where they stand, what their goals are, and what they have to do for a promotion.

Strength Training

Annunzio says high-performance work groups recognize that no one can be good at everything, so they give employees the opportunities to play to their strengths. Training programs show that companies value learning and that effective training helps people develop their strengths. That, she says, offers a greater payoff than training that tries to turn weaknesses into strengths.

"Many people approach IDBI for jobs, because there is extensive training," says Bundellu. The bank's Jawaharlal Nehru Institute for Development Banking, located in Hyderabad, trains company executives in finance and development. It also allows IDBI bankers to share their knowledge with their counterparts in nations that are behind India in the industrial development process. But that is not the only training opportunity available to bank staffers. "We run a lot of training programs on our intranet, on a self-service basis," Bundellu says. This allows for ongoing training and testing in a range of competencies and creates a database of qualified employees to use for future promotion and placement opportunities.

DNV also uses extensive training to keep its staff sharp. In addition to conducting training in the business skills needed to meet customer needs, it trains managers on how to meet their internal obligations. One such offering is a three-day course in managing individual performance, required of all line managers. It covers effective reviewing, coaching, and goal setting. When managers conduct reviews, they place the information in the company's PeopleSoft Human Capital Management System from Oracle. That way there is a consistent record that stays with the employees no matter what offices they may be sent to, making it easier for their new managers to see where those employees fit in and what their goals are. "It lets the information move with the people," says Berge Holm. "Even if they move in the middle of a year or assessment period, the goal assessment is there."

Club Med has also designed its human resources information system so that it has a single instance in place throughout its 100 villages. "We have a lot of people moving around the world every six months," Tarkowski explains, noting that GOs switch between resorts to accommodate seasonal demand. GOs are evaluated by the head of each resort village, but their career path is managed through the company's headquarters in each zone. That's why the company relies on a consistent performance evaluation process with all data held in its Oracle database. No matter where a particular GO is working in a given season, that person's contribution to the company is recorded.

Characteristics of High-Performance Work Groups Susan Lucia Annunzio is the chairman and CEO of the Hudson Highland Center for High Performance and author of Contagious Success (Portfolio Books, 2005), a study of high-performing work groups. She has identified three key characteristics of such work groups: They adapt to the changing economic environment; are customer oriented, whether the customer is internal or external; and know how to manage the internal corporate environment. She says that companies that want to change their workplace need to work counter to conventional wisdom. Here's what she has found in her research: 1. Short-term thinking kills performance. Public companies in particular tend to focus on quarterly earnings. A quick way to hit the quarter is to cut costs, which hurts morale and disrupts projects. Long-term performance requires investment. High-performance workplaces think about return on investment rather than quarter-to-quarter budgets. 2. The leader protects the group from company interference. Management sees its job as allowing people to work rather than telling them, step-by-step, how to do it. A culture that encourages micromanagement doesn't encourage employees to stay. 3. Productivity plus innovation drives high performance. Output is only one measure of performance. Organizations that go to the next level also need to encourage creativity. 4. It's the environment, not the leader. There is no one personality or style for a great leader, Annunzio and her team have found. But no matter who is in charge, great organizations have to encourage smart people to work up to their potential. 5. It's the work group, not the individual. Strong workplaces evaluate employees on team performance. Their processes recognize that the competitor is outside the firm, not sitting in the next cubicle. 6. There is room to grow. High-performance workplaces train and develop staffers so that they can have a career. 7. Your employees can solve your problems. It may seem unusual coming from a consultant, but Annunzio says that employees understand an organization better than any outsider can. As long as they have permission to tell the truth without fear of reprisal, they will come forward with incredible ideas. 8. The "dumb" idea may be your next paradigm shift. New ideas sound strange. In effective organizations, employees are given a chance to explain their ideas. Even if they aren't great, they may spur new ones. If new ideas are ignored or, worse, ridiculed, employees will feel insulted and take them elsewhere. 9. Workers need more information, not less. The more they know about the organization, the better work they can do. 10. Build it, and they will come ... and stay. High-performance groups attract and retain talent, because people want to work where they will be valued. Addressing internal issues is crucial to any recruiting program.

Seizing Opportunities

All the emphasis on recruiting and training is of no use if the employees are not given the freedom to do their jobs. If smart people are treated like they are smart, says Annunzio, they will rise to the occasion. The structure has to stay behind the scenes, so that employees can concentrate on the business at hand. Knowledge workers want an assignment, a deadline, and a budget. Then they want to be freed up to do their job. "Why should working somewhere stop you from doing what you are best at?" she wonders.

IDBI has been able to contribute to India's economic growth through a culture that allows people to take chances. "You are free to operate as long as you are working in the best interests of the organization," says Bundellu. Giving employees the latitude to develop new ideas has allowed the bank to grow with a lean staff; the company's US$19 billion in assets and 95-city branch network are supported by 4,400 employees, a fraction of the head count of IDBI's nearest competitor. Employees are supported by a strong IT system that lets them spend time on banking instead of on paperwork. "What generally takes months in an organization using normal processes takes only a few days in ours," Bundellu says. "IT is one of the tools we use to become a valued financial conglomerate. We are creating one of the largest data centers in India to support banking." People hired by IDBI know they won't be pushing paper; instead, their work on modern IT systems will be part of India's ongoing industrial development.

At Club Med, the company bases part of its performance evaluation on postvacation guest evaluations. These give a sense of overall village performance, but they also look at specific departments. Did the guests like the food? What about their sailing lessons? "The GM feedback is the day-to-day performance material," says Tarkowski. Using these detailed, specific surveys from outside the company, the firm can fine-tune performance expectations, free from internal politics.

With employees of 90 nationalities working in 300 offices in 100 countries, DNV needs a common infrastructure to keep its culture cohesive. The employees use a common language—English—for internal communication, and they work to speak in a way that the revenue-generating risk managers understand. "We use financial language for HR thinking," says Berge Holm; her staff members know they must reflect the overall business emphasis on return on investment and economies of scale if they are to be understood. DNV chose Oracle's PeopleSoft to maximize efficiency. By working off the centralized IT system, the HR employee and manager self-service systems work with the same passwords and reduces the paperwork burden on managers, making them more amenable to the personnel aspects of their jobs.

Becoming an Employer of Choice

For More Information LEARN more about Oracle's Human Resources Management Systems at oracle.com/applications/human_resources

Annunzio says that she starts consulting projects by asking to see recent issues of the company newsletter. "It tells me what that company encourages," she says. She looks to see if profiles are of teams or of individuals and if success stories include evidence of failures, problems, or roadblocks. Setbacks are part of almost any project, she says, but discussing them allows people to learn. "You are telling the people who are reading the stories how to create success," she says.

If people are a company's most important asset, then the assets leave the building every night. Will they come back in the morning? It's no wonder managers tend to provide lots of oversight, but these attempts to protect the human assets can leave workers feeling annoyed and micromanaged. At IDBI the key to retention is the opportunities the company provides for people to become part of large, unique projects and to have avenues for learning. Not every organization can establish stock exchanges and launch an entire class of entrepreneurs, as IDBI has done, but excellent workplaces exist in every industry. As long as managers are willing to respect employees, build on strengths, and stay out of the way, companies will thrive.