People Management: Your People Are Your Profits!

PEOPLE MANAGEMENT:
YOUR INESCAPABLE BUSINESS REALITY IS THAT YOUR PEOPLE ARE YOUR PROFITS 

People are the most important assets that your company has and their effective leadership and management is the key to business success. Put another way, it is the people in your company who hold the key to productivity, because in the ultimate, it is the people in your company who determine the effectiveness with which your company’s policies and operational goals are achieved and the full profitability of your company can be realised. Consequently, your people are your profits!

Warning: There is a considerable amount of information here concerning the premise that your people are your profits, which relates to the profitable use of human resources. I understand how important this information is to you when making up your mind as to who can best help you with the operational management of your business. Consequently, as the guide covers a lot of ground, expect a long read.

Your People are Your Profits: never forget that the cash flow that keeps your company afloat is created by your people

Welcome to another area of great business sensitivity. This one, industrial relations, seems to create a level of discord and worry that it doesn’t really deserve. Why, I don’t really know because there are many other aspects of business that can be just as difficult to manage, have just as serious legal and financial pitfalls and have just as complex governing legislation. Think trade practices, think taxation, think product manufacture disclosures, think consumer protection, think environmental protection just to name a few. I can say that of course because of my extensive industrial relations experience.

My background as an Industrial Advocate. I am after all a former Chief Industrial Counsellor with the Australian Chamber of Manufactures (at that time Australia’s largest employer association). In that position, I led a multidisciplinary team of professionals in providing comprehensive, nation-wide, information, advisory, consultative and representational services to eight national industry councils and about 2,500 independent companies that collectively employed over 100,000 employees in the Textiles, Clothing and Footwear Industries. So I’ve had a fair measure of involvement in the hazardous minefield of Australian industrial relations.

Graham’s people management experience is now on tap to help you

My experience dealing with dispute situations. From the top down perspective, my experience covers the personal hands-on management of company responses to strikes and other forms of work limitation (particularly in circumstances of hostility and antagonism between the parties in dispute); and the negotiation or arbitration of wages and workplace conditions.

Disputes do not always start with employees. From the bottom up perspective, I have many times faced the unpleasant task of having to tell a Managing Director or Chief Executive Officer that their own actions had caused the disputation because their actions were either inconsistent with the industrial awards binding the company or their actions contravened prevailing legislative standards. These company senior managers forgot the truth in the old adage: your people are your profits. In those circumstances, I have had to advise them that they must now accept my recommendations for future action if they wanted the dispute resolved in such a way that they could withdraw from the circumstances that caused the dispute with a modicum of employee respect.

My experience also covers in-house activities. From the middle of the road perspective, I have personally been accountable for the successful conduct and management of all human resources functional activities as an employed in-house HRM.

How may I help you? With my background, I am well placed to give you pragmatic advice on your people management needs that will give you a high degree of flexibility and independence in resolving your people management issues in practical and realistic ways. This independence is a reflection of the fact that I operate autonomously as a sole-proprietor. I am not influenced in any way by my former positions working for employer groups. In fact, you will note from my comments below that I am today somewhat critical of employer solidarity industrial relations policies, and I will have more to say about that later.

I offer a ‘Second Opinion’ service. I offer my people management services to you with the full knowledge that a great many companies, perhaps yours also, are already members of employer and industry associations. Membership of employer and industry associations however can be a double-edged sword. It often brings a new set of difficulties into your company’s people management structures and dispute resolution processes that you can well do without.

Beware of ‘Employer Solidarity’ policies: they can damage your people management activities

Watch out for hidden dangers. Why I say that membership of employer and industry associations brings a new set of difficulties to your people management structures and dispute resolution processes is that those associations have their own industrial relations agendas. That agenda, for reputational reasons, will reflect an ‘employer solidarity’ approach to people management and dispute resolution, even where that means that some of the association’s corporate members are hurt financially as a consequence of the application or implementation of these specific policies.

Your company’s needs are paramount. Such policies may not always accord with policies that you may consider more suitable for your company. At the heart of this is your attention to the nuances and practicalities of industrial relations activities generally. This is the reason that many employers are reluctant to become involved in industrial relations activities.

Many employers and their managers and supervisors do not feel qualified or comfortable dealing with industrial relations issues. Later, I explain that when you subscribe for my help, a primary target of my work for you is to train your managers and supervisors to be able to initially deal with industrial claims and disputes as they arise. The management of industrial relations is not as difficult as common perceptions suggest. Just look at it from this angle: Getting involved in industrial relations is a little like taking a hot bath. It’s not so hot once you get used to it!

Protection for your people management policies and processes

Beware the big picture. When you retain my people management services, I will be in position to take appropriate action to try to protect you or insulate you from damage in the circumstances where an employer or industry association wishes to resolve a dispute in a way that causes difficulties for your company. As a small or mid-size business enterprise, you do need protection when the employer and industry associations attempt to apply a ‘one size fits all’ solution to an industrial dispute situation.

Employer associations always have policy justifications. I am sure you must have heard these justifications for action all too frequently: ‘we employers must maintain solidarity at all costs – sorry about your bottom line this year, mate, but we all must make sacrifices to hold the line against those pesky unionists and activists’. In saying this, however, I am not guaranteeing that you can be fully insulated from the adverse consequences of ‘employer solidarity’ policies in all situations. But you can be assured that I would give it my best shot.

Hard lines hurt soft touches. As an aside, I always found it curious that the companies sitting on the employer association Committees of Management calling for the hardest line against trade unions in industrial relations disputes almost always were the companies with the least amount to lose in the circumstances. The sad fact is that employer and industry associations do not have to have your company’s best interests at heart when they determine their industrial relations policies and strategies. In fact, the reality is that they definitely do not have your company’s interests at heart at all when determining their industrial relations policies and strategies.

Salt in the wound. What rubs salt into the wound of course is that when the employer and industry associations adopt an industrial relations position that adversely affects your company, they will never even say ‘sorry’ to you, even though their ‘employer solidarity’ policy may cost you an arm and a leg by substantially increasing your staff costs or adversely affecting your bottom line in other ways.

Chiron! the business doctor.™ provides an alternative source of advice

Flexibility & independence. By providing you with a pragmatic alternative to the reliance on traditional employer and industry associations for advisory, information, consultancy and representational services, I can give you the flexibility and independence to help you manage your people in a manner that reflects your own company’s policies and strategies and not those of an employer or industry association.

Your company’s needs are paramount. Put another way, you should never lose sight of the fact that your primary responsibility is to your own company, to your shareholders, to your customers and to your own staff. ‘Employer solidarity’ policies promulgated by employer and industry associations from time to time may not serve your best interests at any given time.

People are Profits: Is your people management adversely affecting your bottom line?

Accountability. When you retain my services to help you with your people management activities, my primary accountability will be to add value to your business by undertaking, on your behalf, any or all of the following functional activities:

  • providing you with policy and strategy advice and assistance in circumstances where governments, industrial tribunals, employer associations, industry associations or trade unions take action or impose policies that will adversely affect your company’s best interests,
  • implementing tactical responses to evolving industry circumstances arising from government regulatory policies, employer association solidarity policies, trade union industrial policies or the state of the national economy, thus ensuring that your company is always in the best position possible to make informed decisions about future courses of action,
  • utilising change management techniques encompassing appropriate combinations of enterprise restructuring strategies, process improvement objectives and performance management techniques to increase your company’s cash flow, productivity, international competitiveness, profitability and shareholder value.
  • representing you at the highest possible level in major industry policy/industry strategy issues (whether or not these issues directly involve industrial relations matters), the reality being that there are very few industry issues that do not have a substantial impact on your company’s people management policies and practices.
  • applying appropriate employment management systems and procedures to deal with the multiplicity of people management issues that arise during the course of your company’s day-to-day business operations,
  • undertaking the conduct and management of high level negotiations with Government Ministers and senior departmental officers in relation to legislative, regulatory and industry policy issues,
  • undertaking the conduct and management of high level negotiations with trade unions and employee representatives in relation to industrial awards, industrial agreements, employment policies and work practices,
  • undertaking the conduct and management of high level negotiations with senior management, professional and executive staff in relation to contracts of employment, performance management and matters related thereto,
  • representing your company before industrial tribunals in sensitive disputes involving strikes and other forms of work limitation, public interest ‘test cases’ concerning matters of employment law principle and policy, appeals against adverse tribunal decisions and in proceedings related to allegations that your company may have unfairly dismissed an employee,
  • providing you with workplace cross cultural advice and assistance in dealing with other countries’ employment laws and standards while respecting cultural, racial, political and religious differences.

Industrial Relations vis-a-vis Employee Relations

Definitions. For the purposes of explaining my approach to people management, I define industrial relations as dealing with employees in groups, and employee relations as dealing with employees on an individual basis. While purist or pedantic human resource professionals may take issue with those definitions as being too simplistic for technical reasons, they do illustrate the clear distinction between what are the two major people management activities that you must implement sensitively and pragmatically both directly and through your company line managers.

People management in practice: the Chiron! the business doctor.™ IR focus

Guiding philosophy 1. In representing your industrial relations’ interests, my guiding philosophy reflects two concepts. Firstly, I take a completely different tack to helping clients with their industrial relations to most industrial relations consultants. I help you by developing your line managers & supervisors’ industrial relations management skills. Most industrial relations consultants prefer to maintain the fantasy concept of the ‘consultant’s mystique’, where consultants maintain that they are a fount of knowledge and their expertise cannot be disclosed or transferred to everyday persons such as your line managers and supervisors.

Thus, of course, you have to rely on these consultants more and more, generally at an ever-increasing cost. With the way I work with clients, my services should be required less and less over time. Let me explain.

Your line managers & supervisors are the first port of call for receipt of claims & disputes

Important role of supervisors. Why I take this approach to client relations is that in the industrial relations reality of today, the company officers primarily responsible for people management (your line managers and supervisors) have the responsibility for initially dealing with employee claims or workplace disagreements. Consequently, these company executives and supervisors must be proficient in dealing at first instance with employee claims or workplace disagreements.

Supervisors control the future. After all, if an employee, an elected shop steward or job delegate, or a Union official knocks on your company’s door and asks to discuss a particular issue, you cannot say ‘sorry, I can’t talk to you right now! You will have to wait until I can arrange for our consultant industrial advocate to arrive to help us out’. The critical point here is that if your line managers and supervisors do not conduct the early stage negotiations professionally, it will be more difficult to resolve the matters in contention later on.

People are Profits: there are two methods of dealing with industrial relations issues

Guiding philosophy 2. My second guiding philosophy is that I act within the framework that there are two methods of dealing with industrial disputes. One is by removing the causes, and the other is by controlling the effects. In Australia, we have historically tended to give prominence to the latter; that is, whenever we talk about industrial relations, we tend to talk about conciliation and arbitration and the legalistic framework that surrounds it.

Debate is public, but action must be private. Much of the very public controversy over WorkChoices fell into this category and the current community debate about the Fair Work legislation that is taking place also falls into this category. But the true reality for you as a business owner is that you cannot escape the fact that the effectiveness of industrial relations policies directly relates to people and aspects of their total working environment.

Emphasis on internal resolution. Consequently, my focus is to place a much greater emphasis on finding the answers to your people management problems by dealing directly with the issues and the personnel involved. This is a much more preferable way to resolve difficulties and disagreements. My experience has shown me that in the resolution of disputes and disagreements, companies should not rely upon the decisions of a legally-appointed ‘referee’ who has no real interest in your company’s long term business objectives and who has no reason to respect the fact that your people are your profits.

People management in practice: the the Chiron! the business doctor.™ ER focus

Concern for employee welfare. It has been my experience in the conduct and management of employee relations activities that companies generally have a strong concern for their employees’ welfare. But this commendable corporate attitude is rarely taken to its ultimate conclusion. That conclusion is the formalisation of a company’s employee relations practices so that employees are able to understand why companies do things in certain ways.

Ad hocracy rules. Rather, my experience over many years of involvement with a variety of companies in different industries is that companies seem to adopt an ad hoc paternalistic approach to specific employee relations issues. In many instances however, it is this very ad hocracy which creates discord and encourages disagreements from the staff.

Does this sound familiar? A typical example of an all-to-common situation is where a company reacts to a set of circumstances involving one or more of its employees, in many cases because it has no formal policy to follow in such circumstances. Subsequently, the employee, his or her workmates and often the employee’s union, take exception to the company’s action and a formal industrial relations dispute suddenly arises. Of course, the inevitable result is that the outcome of the situation will determine the company’s policy in similar matters in the future, and that result may not be in the company’s best long term interests.

But at that point unfortunately, it is too late to cry over spilt milk:  if the company had really wished to opt for a more favourable outcome, then it should have taken the initiative to establish the policy it wanted prior to any dispute arising. Prevention after all is much more palatable than a distasteful cure supplied by an industrial tribunal acting as referee. In advising you about your people management responsibilities, my focus therefore is to help you to proactively establish pragmatic policies and procedures that rest on mutual trust and respect and can be clearly understood by your employees.

Chiron! the business doctor’s™ people management service: what you get

When you subscribe for my modestly-priced people management service, you will be given the following help:

  • practical briefing sessions in people management issues for your company’s line managers and supervisors,
  • the ability to call me urgently if you unexpectedly get a dispute situation that is complex or requires sensitive handling because of the subject matter, and
  • up to an  hour of one-to-one consultations every month, with no restrictions on the topics to be discussed. You pick the topics for discussion, and nothing will be off-limits.

The topics you wish to discuss therefore are not limited to industrial relations or employee relations matters, but can encompass any of the subjects about which I provide consultancy assistance to clients. This is simply the recognition that almost all problems or difficulties that companies face from time to time will affect their employees in one way or another.

Last Word

Industrial disputes: there’s no escape. In today’s difficult economic circumstances, even the best run companies are never immune from industrial relations disputation from time to time! And while many business owners and chief executives like to think that they are an expert in dealing with industrial relations (after all, doesn’t everyone know what to do with and to those damn unionists!), the fact is that they are not experts. This point of view was very succinctly put by a former eminent Deputy President of the former Australian Industrial Relations Commission who once famously said: ‘There are no experts in industrial relations, only survivors’.

As a survivor of more than twenty five years traversing the minefield that is the Australian industrial relations system, I am well qualified to help you in practical ways.

Yours sincerely,

Graham  Segal

Chiron! the business doctor.™ ... relieves business pain!™ 

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© Graham Segal, Author. March 2013. All Rights Reserved

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This website and the associated webpages content are produced by Graham Segal trading as Chiron! the business doctor.™. They are licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License based on Graham's work at http://chironthebusinessdoctor.com.

Date this webpage last reviewed/updated: 23 May 2013

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