Breaking down traditional hierarchies to succeed

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On day one of the HRD Summit Nilofer Merchant and Bosch's Rosa Lee described the importance of empowering people to contribute

Organisations must break down traditional hierarchies to succeed in an increasingly VUCA world, according to several speakers on day one of the 2018 HRD Summit in Birmingham.

Starting the day with a keynote speech, Thinkers50-ranked business author Nilofer Merchant described how, having disobeyed her parents in choosing further education and work over an arranged marriage, she discovered upon entering business that colleagues put her in ‘a pre-determined box' in much the same way as her family had.

“[My family] saw an Indian, Islamic girl… not an individual with unique ambitions for what she wanted for herself,” reported Merchant, relating how she quickly realised in different companies that there were always people in the room, like herself, wanting to contribute but never being asked to.

Merchant gave the example of a meeting at Apple where she researched the topic ahead of time and thought of questions she wanted to ask. “I was ready to contribute but it took just a minute to realise that no-one was making any eye contact with me,” she said.

The same pattern kept playing out: “It was only MBA types in this room [that got to contribute], only sales and marketing in this room… in this room the CEO is in charge,” Merchant reported. “And at any given time there were people sat there ready to help solve the problems of the day but they got passed over.”

Breaking down such hierarchies and preconceived assumptions about different sorts of people could be the key, however, to ensuring businesses succeed in challenging times, Merchant said: “I thought ‘that could be the disruptive force for how business changes,'" she said.

“We are at a crisis moment when we can’t come up with fresh ideas… [but we can] use our people to do that,” she said, adding that not being able to innovate as a company “isn’t a minor problem”.

“These people can help you innovate to the future,” she stated.

Also speaking at the event, senior VP of Bosch corporate HR Rosa Lee, shared the way her company has started to adopt less formal, Scrum, project-based approaches.

The company has started dispensing with formal titles and making hiring decisions as teams, Lee reported. Bosch also trialled team compensation, where staff determined each others’ pay. But employees said they didn’t feel ready for this even after nine months of agile working, reported Lee.

She described how HR systems must change to support less hierarchical, more agile ways of working. “None of the existing HR systems will work” in such a context, she said, citing the example of performance management. Describing how Bosch has now shifted to become an Internet of Things (IoT) business, Lee said: “In a software business you do projects every six to eight months so you don’t have a manager who can appraise you annually.”

Such a significant shift has not been without challenges, related Lee. People like to belong to certain departments and stratas within organisations, she explained, with staff at first feeling that they no longer “had their home turf” and had lost their identities.

She added that, despite being highly worthwhile eventually, “it’s very difficult to do team feedback”.

Speaking at another session, on ‘Getting people to drive commercial performance in VUCA times', managing director at Notion Dominic Ashley-Timms stressed the scale of the challenge an ever-quickening pace of change presents, highlighting that world knowledge now doubles every 13 months. (Compared with the end of World War II for example, when it's thought world knowledge was doubling every 25 years.)

Regarding the need for organisations to rapidly experiment, innovate and move in new directions, Ashley-Timms quoted writer and speaker Reva Basch, urging companies to realise the power “not of hiring cleverer people to come up with answers, but of getting people to ask better questions”.

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