Best Practice

Personnel Today’s monthly series reveals how managers tackle
business problems and enhance performance. In this issue, Graham Schofield,
business excellence manager with HSBC Bank, maps out his route to effective

The Personal Financial Services (PFS) arm of HSBC Bank delivers pensions,
investments, insurance, mortgages and other wealth management products through
a network of 1,671 branches, TV/PC and Internet banking, and direct financial
services. Employing 2,750 people at six sites in the UK, this business unit has
enjoyed considerable success in the last five years with a compound growth rate
of over 10 per cent and a 75 per cent increase in managed funds.

Like any business with a high street presence, PFS needs to generate a
caring image among existing and potential customers. While this has arguably always
been the case, intense competition and better informed and more demanding
customers leave little room for complacency.

However, exulting employees to consider the customer in their thoughts and
actions is not enough by itself; you have to win "hearts and minds"
and provide tools and processes that deliver the desired service level.

Research on customer satisfaction reveals only part of the story. For the
complete picture, you have to look at employee perception and our attitude
survey in autumn 1996 revealed a less than perfect view.

The study found a company grapevine in rude health, delivering messages way
ahead of official communications – if somewhat inaccurately. Team briefings
were seen as management driven, with few opportunities for employees to get
their messages across.

Obviously this muddled transfer of information could not continue. As PFS
general manager Nathan Moss said at the time: "For seriously happy
customers, you’ve got to have seriously happy employees. So managers need to
evolve into leaders, able to inspire action."

Working with senior management and front-line employees, Moss defined
leadership and the competencies that support it.

He also reasoned that everyone has three roles:

• to learn and take an active part in their development

• to make decisions

• to work from a customer perspective, questioning existing practices and
offering alternatives for those that do not add value.

Our blueprint for improvement is the HSBC Bank maxim of "Listen,
Understand and Deliver" and its accompanying values. The latter encompass
active listening, understanding, forward thinking, integrity, straightforward
and freedom to deliver. Behind these statements, however, lie behaviours that not
only help PFS gain more business but also assist in day-to-day decisions.

For leaders, the challenge is three-fold: to communicate the vision; to gain
everyone’s commitment to their multiple roles and, most importantly, identify
those measures that align with excellence.

For this we had an excellent foundation with which to measure progress – an
upward feedback questionnaire from 1995 that was modified and re-named the
Leadership Index.

The leader’s year

Leadership is well signposted, starting with assessment during recruitment
and induction. In line with the rest of HSBC, we operate an executive
performance and development scheme that begins each January with the manager’s
annual review, with two executive development forums (EDFs) following in April
and October. These examine leadership skills and management potential. The EDF
acts as a succession-planning mechanism to fill key positions, matching the
right people to the right job and avoiding unnecessary external recruitment.

Employees, too, get the chance to assess leadership. At the annual roadshow,
for instance, they review our HR strategy and tell us how well it’s working,
looking at issues like helping managers to see themselves as leaders. This is
backed up with feedback from the annual opinion survey.

Assessment and action plans are supported by deliverables such as the
Leadership Toolkit. Split into two sections, this shows how to address skills
gaps and provides a series of booklets on core leadership tasks – for example,
setting objectives and conducting appraisals.

In three years, leadership in PFS has come along way and much of our success
stems from an insistence on measuring progress against the European Foundation
for Quality Management’s excellence model. This not only gives structure to our
improvement activities, but also provides measures of progress and of internal
and external best practice.

Our employees have also ratified the change, the 1999 HSBC Bank employee
survey revealing that:

• 75 per cent of staff see PFS as a well-led area, up from 42 per cent in

• 76 per cent say decision-making is an integral part of their job

• Seven in 10 PFS employees receive all the information they need, while
eight in 10 regard the information as credible

• 82 per cent of PFS employees say senior management contact is now
sufficient for their needs.

As you might expect, it is not all plain sailing. But the fact that
employees now feel able to voice their concerns must be taken as a positive
sign. Meanwhile, the benchmark for effective leadership does not stand still
and we have to constantly assess our programme. So plans for this year are to
re-evaluate the Leadership Toolkit and create a development centre for leaders.


Top tips effective leadership

• Set clear guidelines for the leader’s roles and responsibilities

• Embrace leadership improvement within "business as usual"

• Provide suitable training and support materials to help leaders attain and
re-inforce the desired skills

• Develop openness and trust to encourage direct reports and internal
customers to give feedback and help the manager concerned seek out employees’
views. In 1997, we invited 350 employees to comment on leadership and people
management in our business excellence review

• Be prepared to adapt. Our half-day employee roadshow was re-designed from
its original "stadium" concept to an interactive workshop for more
involvement and discussion

• Employ external research agencies to conduct employee opinion surveys and
give an objective view of improvements. We have used Mori and ISR

• Promote leader-employee involvement through team initiatives. Our
"100 bay War on Waste" induced competitiveness and generated over £1m
in potential savings

• Ensure senior managers make themselves available to their teams – informal
walkabouts and employee lunch sessions, for instance

• Champion the cause from the most levels to provide direction and maintain
momentum in the programme

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