In recent months the conversation about what’s fair versus what could or should an organisation expect from its people in terms of performance has once again shifted from an interesting philosophical debate into a point of contention following the admission from a number of Executives that their workforces will need to step-up if their companies are to survive long term.

While for some organisations this is business as usual, an increasing number are coming to the harsh realisation that their current productivity levels are insufficient to off-set the high kiwi dollar meaning their businesses, as they stand today, are unsustainable.

Pacific Aluminium’s Tiwai Point illustrates the significance of this challenge and for this reason could be positioned by the business community as a catalyst to justify the deeper conversation we need to have about performance given it is, in many instances, only by improving staff engagement and productivity that NZ businesses can prosper in the future.

Two problems that are likely to inhibit our ability to find a solution:

• The practice of benchmarking against identified competitors and
• The protective and unhelpful response often presented by Industrial Unionists in terms of what’s fair and reasonable.

The fact of the matter is, if we want New Zealand to prosper, we have to become more competitive; however in order to achieve that, we have to accept we are on the same side and therefore need to figure out what we are capable of delivering in order to remain relevant. In other words, for as long as we pit one group against another i.e. management against workforce, we will miss the point entirely and as a consequence, lose the battle of improving our international competitiveness.

However if we understand we are ‘in it together’, we might if we are smart create an opportunity to discover a new way of operating that not only addresses the issue, but offers material benefits to both parties. To kick the process off, I will offer a few thoughts on each.

 

1. Benchmarking

While there is value in benchmarking, it is rarely a silver bullet. The reason for this is because it tends to act as a ‘cap’ as much as it does an ‘enabler’. In other words, if an organisation reaches a point where it is deemed competitive by industry standards, most involved tend to assume that because they meet certain criteria that ranks them as competitive they are automatically (and therefore by default) high performers. However, who is to say the organisations they are benchmarking against, even if they are the best in their segment, are high performers? Just because they are better than the rest doesn’t mean they are masters of their craft, it might just mean they are better than their competitors.

For this reason I believe it is useful for organisations to think about benchmarking in two equally weighted ways. The first is against international best practice to assess where they are at against the best in their industry in order to ‘reflect on what’s proven’ and secondly, to consider the potential they have within their team in order to ‘consider what’s possible’. The first substantiates the facts even though circumstances in their respective sector in this country might make the benchmark unrealistic to aim for, while the second encourages managers to look deeper in order to think about what’s possible given the ceiling is most readily addressed when we compare our performance against our presumed potential.

Although I will discuss this further in the next section, I am a firm believer in the idea that the vast majority of us i.e. the human population are inherently capable of producing infinitely more than most of us ever will and for this reason, believe it is not only appropriate to explore the subject with interest, I believe it is an insult if we don’t.

2. Fair practice

In my opinion the discussion about ‘what’s fair and reasonable’ remains in its infancy. The reason I say this is because although there is a desire to operate in an appropriate manner, the gap between camps has continued to widen thereby suggesting the discussion has as yet failed to provide a practical and meaningful solution. Although the reasons as to why this might be the case are obvious, the fact it is where it is, is of little help to anyone meaning we need more willing and able parties, without prejudices or agendas, to enter the debate in order to encourage appropriate dialog otherwise we run the risk of being consumed by our differences rather than addressing the actual challenge.

A good example of this is the as yet unresolved dispute between the Ports of Auckland and the Maritime Union. If we look at it from the Maritime Union’s perspective, they are of the view that their members either need or deserve better terms and conditions (or pay for their work) to keep up with the times (and/or inflation); and given they see their job is to negotiate on behalf of their members, we can understand why they are holding out even though it might in the long run be counterproductive especially when it is putting their jobs on the line. The Ports of Auckland management on the other hand recognise that if they are unable to improve their competitiveness by either improving their efficiencies and/or lowering the cost of their operation, they will not only fall short in terms of meeting their obligations, they could lose their jobs by failing the people of Auckland.

For this reason I believe the unions have a crucial role to play not in protecting their members’ rights, but by improving their competitiveness and ability to add value to their employers. If the unions said our focus is to improve the outcomes for our members, they would see the only way they can do that is to enable them to ‘secure their futures’ by helping them be more productive rather than trying to secure their futures by fighting for their rights at the expense of the business (I accept there will always be cases where unscrupulous employers try to take advantage of vulnerable employees however they are not the majority and shouldn’t therefore be used as the basis of a union delegates modus-operandi).

To this end, I would encourage every person irrespective of their position to ask themselves the question ‘how can we deliver more value in order to be more successful?’ In other words, the more successful a workforce is, the more the business can invest in its future; whether that be by working harder to retain their high performing individuals or embedding new technologies and optimisation programmes to enable them to be more productive i.e. there is no value in trying to encourage employers to expect less from their people, however there is extraordinary value in exploring how they can enable their members to deliver more for less as that is what ultimately matters.

Last but not least, I am convinced the vast majority of employees want to excel. They want to know they are relevant and that their contribution matters. If we adopt a stance that says ‘it’s unfair to expect more’ not only are we failing to honour our purpose as leaders, we are putting our people’s futures at risk and by doing so leading them towards commercial oblivion.

At the end of the day people want to be part of a successful team that delivers demonstrable value to its stakeholders and while no one appreciates being exploited, almost everyone wants job security. This means we need to reposition the idea of security to ‘a consequence of the value we add’ not a ‘right we should expect irrespective of our contribution’ i.e. just because I turn up doesn’t mean I should be better rewarded. However, if I turn up and endeavour to excel, I can influence the value I add and thus my employer’s interest in wanting to keep me on board. This is the role I believe unions can and should play given they are in a unique position whereby they can influence their members’ mind-set and behaviour and thus their long term employability. In other words, employees are likely to experience the benefits of being their very best by focusing on their performance as it will in most cases cause their employers to see wisdom in enabling them to prosper, not just recognise and suitably reward them.

 

Please refer to an earlier newsletter ‘Future of the unions’.

 

 

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