Shortlisted team for Award for Organisational Change: Personnel Today Awards 2000
When Arrow Electronics took over Electronic Services in November 1997 a "big bang" approach was applied to the restructuring exercise to align the two organisations. Each company had 600 staff but instead of allowing each firm to continue operating independently the decision was taken to create one new organisation with 900 staff within less than two months.
In the organisational change that followed – codenamed Project Richmond – timing and communication were crucial, says HR manager Pat Patterson. An announcement was made a year after the acquisition in November 1998. "Within two weeks people knew whether they had a role in the new business. As soon as the steering group had agreed the new business role, HR was involved in organisation design, role definition and implementation programmes which included selection criteria. HR acted as the change facilitator, providing the expertise."
To this end, HR set up a system where the skills and potential of employees were assessed. Offers were then made to the preferred candidate. An offer was quickly made to a previously identified substitute candidate if the first employee turned the down the post.
Candidate information was written up during interviews and immediately faxed over to HR where it was collated at Project Richmond’s "mission control".
Here, four teams – executive, senior management, HR and external experts – worked together to resolve issues ranging from vacant posts to giving advice to managers meeting with their staff. Lawyers were also on hand in the first days after the announcement.
A consultation process with managers was also built into the assessment process to identify staff who had achieved low evaluation scores – perhaps because they were new – but who were seen as having valuable potential.
As part of the communication strategy, a hotline was set up for employees to seek advice and a series of weekly newsletters kept staff up to date with developments.
HR also brought in experienced external advisers to provide detailed training for managers facing the task of making announcements to staff. Other initiatives included making a career consultant available for employees. After decisions were reached on jobs, those being made redundant were also given the chance to take part in career workshops, and meetings were arranged with recruitment consultancies.
Meanwhile, the same process of alignment was in operation in the HR department. Before the alignment, Arrow’s HR team had 11 employees, compared with Electronic Services’ team of 10. Following the completion of Project Richmond the combined team numbered 11, although this figure has now risen to 13.
Arrow HR director Sandra Campopiano was a key player in the steering group that developed the business model in the 13 months before the announcement. She said one of her main priorities throughout the process was to ensure it was fair and consistent and that those being made redundant were able to leave with their dignity intact – Arrow arranged a leaving party to bid farewell to redundant colleagues.
When the alignment was completed, Arrow’s HR team continued to play a central role by running a culture workshop for managers to help embed the values and philosophy of the new combined businesses.
Nearly two years on, Arrow believes Project Richmond has had a major impact on the business. Staff turnover has improved, sales are up year on year by 24 per cent and profits are up 14 per cent.
Company fact file
Team HR team Arrow Electronics
Team leader Sandra Campopiano
Number in HR team 21, before alignment; 11 post-alignment
Number of employees responsible for after alignment 900
Main achievements Positioning of the UK business ready to embrace and encompass future change in the European electronics distribution market. Tailoring the way it distributes to meet the needs of customers and suppliers. Successfully integrating two companies’ very different structures.
Priorities for next 12 months To build on the successes and to continue to develop and refine its European organisation. To further consolidate its position as a leading electronic distributor
Judge’s Comment "Arrow dealt with one of the greatest challenge in change – combining two different cultures to create a single shared culture. It was focused yet sensitive in its strategy to retain its best people while addressing the redundancy and management of those no longer required for the new organisation. The extent of preparation, planning and rationale behind its ‘big bang’ approach was also impressive"