Two-headed people? Customers vs colleagues.

The Two-headed People Challenge. Customers and colleagues are all human, so why manage them as different disciplines?

Richard Eyre from the IAB, Harriet Hounsell, Personal Director at John Lewis and Sara Milne-Rowe, a leadership adviser gathered at The Foundation Forum in September to talk about people. Here's what happened. Written up with the help of Simon Caulkin.

Business performance depends on people. Obviously. One group of people buy the products. Another group of people make them in the first place. The behaviour of the two will make or break an enterprise.

Although they’re in different groups, they are the same species and more similar than distinct – motivated by, fearful of, bored by, fulfilled through similar things, united by human characteristics.

We often have ways of doing things we don’t question. Accepted wisdom, common practice, but that doesn’t make it a good idea. An example is the way we manage our ‘human assets’. One team does the people inside, another does the people outside. Why?

The work of our September Forum was the exploration of this conundrum. Why do HR and Marketing share so much yet share so little? Is there a better way that just needs us to ask directly enough?

We brought together three people to explore this with us, all of whom bring the highest level of skill to their respective ways of working with people

• Richard Eyre, coming from the Marketing side of the tracks.  A Media agency guru who became a media company CEO, the most personable purveyor of snake oil you’re ever likely to meet
• Harriet Hounsell, Personnel Director at John Lewis and thereby leading the poster child of people engagement, the employee-owned retailer that the government is using as a blueprint for a worryingly large chunk of our future
• Sara Milne-Rowe, a much sought-after leadership advisor who learned her trade on stage and in front of classes of kids, and who operates free of silo and so, perhaps, with a liberating purity of intent

So what did our three heads make of the two-headed question?
‘CEOs know that they depend on their company’s human resources to achieve success. Businesses don’t create value; people do’. Thus begins a lengthy article in a recent issue of HBR whose cover declared: ‘It’s time to blow up HR and build something new’. Yet despite the incendiary coverline the articles in the section came up with disappointingly little that was new – which was partly what prompted the more practical and (dare we say) more interesting question debated at September’s Foundation forum: in an era where there is much talk of joined-up management and (yes) blowing up functional silos, why don’t we manage the human beings who work in HR and Marketing as one? We don’t manage internal and external money separately: a Finance Director does the lot. So why not a ‘Chief People Officer’, ‘Human Director’, or even ‘Empathiser-in-Chief’ to unify Marketing and HR?

A powerful case for just that was made by Richard Eyre, a marketing man to his fingertips, having been Media Director at ad agency BBH, CEO of ITV and RTL, and now chairman of the UK Internet Advertising Bureau and The Media Trust. His message: in today’s always-on, instant-exposure, oversupplied world, any company that tries to spin its proposition will be overheard and mocked, ‘“lolled” in public to everyone else that you thought you could get away with it with’. The ease with which information, yours or theirs, can be shared and commented on, he argues, requires companies to cultivate a deliberate and consistent brand integrity, in both senses of the term: honest and authentic, but also integrated with the company’s identity, ‘so that the brands are an expression of the firm’s purpose.’

The underlying issue here is trust. Companies need to move customer engagement beyond transaction to an enduring relationship. To do that ‘you’ve got to be allowed to use data, and for individuals to let you use data you have to build a level of trust’. That backs up into corporate purpose, because neither as consumers – we all know how to read ‘marketing’ these days – nor as employees will we any more commit to a company that stands simply for maximising shareholder value.

Of course, in reality, this is a false conflict. ‘We know that making shareholders an end in themselves risks behaviour that will not look after customers and will not look after employees, and so by that means actually diminishes shareholder value.’

The implication is that messages crafted only by suave ‘pointy-heads’ in Marketing are self-defeating. ‘To be truly authentic, and therefore believable and trusted, a company has to get over the problem of internal communications.  It can’t separate internal communications from external communications. It can’t separate internal communications from culture, from remuneration policy, from what the organisation is saying about itself in the public domain.  All of those are the same message, and to achieve a true integrity all have to be planted in the same soil and ultimately tended by the same gardener’.

But Harriet Hounsell, the second speaker, was coming at the issue from the different perspective of Personnel Director (an expressively old-fashioned term) for John Lewis.  She admits that her first reaction to the notion of merging HR and Marketing was, ‘you’ve got to be kidding!’ That softened as she thought about it, she says, into ‘no, not yet’.

Her misgivings centred on practicalities and whether each team saw potential in a shared purpose.  In the first place, planting and developing the idea of what two teams could jointly achieve ‘if they got their hands around the purpose’ takes time and engagement. A fully-fleshed-out business case doesn’t exist. ‘As yet I don’t see a sense of curiosity across the two functions that would lead me to believe there is a mutual, beneficial question to be answered.... From where I sit it just feels a bit naïve to think this would be simple to achieve’.

The second difficulty is that HR and Marketing come from such different places that shared experiences are limited. To put it stereotypically, while HR lives at the sharp end, with employees serving and getting instant feedback from sometimes difficult customers every day, in some cases, Marketing can be more remote from the front line and direct customer experiences, producing sophisticated campaigns that builds emotional engagement with the brand. These two worlds feel to me quite distant at this moment; although with the trend towards customer experience being more central, this is likely to evolve.’

(To put it even more stereotypically, ‘How would Marketing and HR teams go about changing a lightbulb?’ the Chairman, Charlie Dawson, had mused, before answering his own question: Marketing would launch a campaign to sell the lightbulb the idea of a new life beyond the light fitting creating a desire for change, bolster it with behavioural nudges to rotate it around the fitting, before a reward programme kicked in, eventually generating an almighty electric shock to thank the bulb for leaving; HR on the other hand would review the lighting performance of the dead bulb, providing constructive feedback and training for better light emission, followed by a series of written warnings until after six months of documented conversation the bulb would be escorted out of its socket.  Although the reference said it still worked well…)

Her third point was that each function is grappling with different insights. This is not to say that there isn’t potentially fertile crossover: Marketing teams should try sitting in front of a group of bolshy customers using the customer experience lens as an aid to thinking through a marketing campaign, suggests Hounsell, while HR teams could profitably learn from marketing in communicating their message, vision and contribution to the business. ‘There is something shared and yet utterly different about their practice...If you ask the teams a different question – what are you doing that we could learn from, and what are we doing that you could learn from – then absolutely there are ways we could unlock this opportunity in the future’.

As Eyre pointed out, structurally HR and Marketing do come together in the office of the CEO, who is ultimately the human director responsible for both. So the question then is, how can the merged view be pushed down so it runs right through the organisation? ‘This thing about purpose and passion has got quite a long way to run,’ he believes. ‘I think we’re slightly fiddling about with it at the moment’.

Part of the answer, proposed leadership coach Sara Milne-Rowe, drawing on experience in the performing arts and classroom, may be to disconnect from the ‘task’ and bring to bear the energy that is generated by human insight and connection.

’This lesson is effing boring,’ Wayne, an aggressive teenager, once announced to a startled Milne-Rowe’s class. Instead of reacting by reporting him to the Headmaster (the task), Milne-Rowe ended up reinventing her teaching practice around the less conventional insights derived from Wayne and his mates. Lessons that were structured but fresh, delivered by teachers passionately involved with their subject to students who could feel they were individuals rather than one of a mass of 30, could turn a ‘reluctant, dysfunctional, often angry young person into somebody who wanted to learn, actively participate and make the choice to move forward all in the same day’.

Business leaders need to develop their own insights, she says, perhaps from customer or employee surveys, but also from their own perceptions. Yet insights on their own aren’t enough: it’s the energy that stems from connection at the human level that triggers real step-change, she maintains. Like the notoriously poorly-performing US shipyard that in 2007 startled onlookers by delivering on time and under budget a vessel that had become a labour of love that even retired workers queued up to do shifts on. The difference?  The ship contained seven tonnes of steel salvaged from the Twin Towers, under the mantra ‘We will never forget’ – for Milne-Rowe ‘a fantastic example of the power of the energy from connecting to cause and purpose’.

Another example: research in which two 10-pin bowling teams were filmed and invited to critique themselves, one with the emphasis on what they were doing right, and the other on mistakes and failures. Both teams improved; but the one that focused on success improved twice as much as the other – and it enjoyed playing more too.  The advantages of focusing on success are many, says Milne-Rowe: ‘People are more honest.  Then when you focus on observing success it’s attached to something real – better teaching, better bowling, better behaved Waynes: and it’s also more fun.’

In other words, of course HR and Marketing are important. But their work may be of limited impact without the leadership insights that energise and make them actionable every working day.

‘So much of management consists of making it hard for people to do their job,’ Peter Drucker once sighed. The obscuring of purpose by the task may be one main reason, and the speakers agreed there was a long way to go, and many elements to align, before the sense of purpose might be strong enough to liberate people from the straitjacket of functional thinking with which most firms struggle.

In one sense, we know how to do it: as Eyre points out, ‘Whatever you do in a human relationship to make it work, you do in a corporate relationship too. It has to be consistent’. But this is to reckon without what has been termed the ‘knowing-doing gap’, the tendency of organisations to prefer words to action, detailed planning to trying things out, and knowing how ahead of than knowing why. Maybe it’s time to stop fretting about whether we know enough, and instead shut Marketeers and HR people in the same room together, tell them to get on with it and act and learn from that. Wasn’t it a marketing campaign that exhorted, ‘Just do it’?

The Foundation’s view
We enjoyed this conversation as always, but maybe especially because this kind of inside/outside combination is at the heart of why we started on what we’re doing all those years ago (16 in fact). Two points stood out for us as being worth underlining:

1. Like gravity, we seem to be drawn away from a human view of our business world and towards something task-y. We know how to deal with people on an individual level, but somehow when we try to build a relationship with customers, our view of what’s needed – being consistent, listening, talking in a personal tone, being surprising from time to time – goes out of the window. It is, for example, a long way removed from the loyalty card version of relationship building, all about vouchers and prodding us this way and that. This ‘loyalty’ thing works in the short term of course – why ignore an offer? But it doesn’t build anything that deserves to be called a relationship.
2. A uniting force is purpose, and a shared set of beliefs about the way the world works and the way the businesses succeeds that fit around it. But this already sounds like management guff. Sara showed what purpose really means, how it can be liberating, guiding, inspiring and useful, in her example with Wayne – she knew why she was a teacher. Not a neat, wordsmithed sentence but a deeper sense of why she was there. To help him develop. Reporting him to the Head wouldn’t help. Finding a way to earn his respect and attention did. How many exercises about purpose become negotiations about vocabulary and syntax rather than a search for meaning? (Many).

About The Foundation
The Foundation is a growth and innovation consultancy, architects of growth. We help our clients build famous customer centric organisations and solve their most difficult growth challenges.

Like architects we work towards a result, an organisation having successfully grown, not to specific outputs like a set of recommendations in a document or the delivery of a training programme. To achieve the result of growth you need a blend of skills and experience, usually provided separately, to be brought together. As an architect brings together understanding of the science of structures with the behaviour of people using the building, the impact on the outside world with function it performs for the owners and users, and the changing needs of a project through creation, design, construction and on-going enhancement, so do we.

We love working collaboratively with leaders who are committed to making growth happen in ways that will last. Our work is diverse, typically in one of the following areas:

• Customer centric transformation (eg Jaguar Land Rover, Welsh Water)
• Business-wide customer strategies (e.g. Save the Children, Harvey Nichols, HSBC)
• Customer experience (e.g. Eurostar, Camelot)
• Customer value propositions (e.g. Just Giving, Tesco)

The belief behind our work is that managers in all organisations look at their world from the inside out, with colleagues close and customers far away, with the market being defined by what’s measured, and lots of assumptions about what's possible.

We help them look from the outside in, getting personally close to customers not just using market research, and going outside their sector, again in person, by speaking to senior managers from other organisations to learn what happened there in similar situations.

This means the team explores fresh new relevant ways around their issues and then works together to see what’s plausible, often finding that together they can change things by combining across a number of functions, getting around roadblocks that had previously been constraints.

This link will take you to more information us and our Forum events: http://www.the-foundation.com

Charlie Dawson is partner at The Foundation.