A member of the Accounting for People Task Force outlines why people have
the power to transform your organisation, but warns against comparisons with
other, non-human metrics
At Cadbury Schweppes, we believe that driving successful performance is 20
per cent about strategy and 80 per cent about people.
Like any other company, the key distinguishing assets we have are our brands
and our people. The long-term health and performance of our brands is entrusted
to the current generation of people we employ. Ensuring we focus on and measure
their contribution and development is therefore a major part of our success.
In driving this focus, we choose to concentrate on outputs as well as
inputs. It is, after all, not the specific amount of money we spend on
training, but the use that training is put to that makes the difference.
Making the link
Our approach, over and above the general development of a standard
managerial skills base, focuses on linking training to our key business issues.
Recent examples have concentrated on expanding our skills in strategy, growth
and innovation.
However, there are limits to the measurement of human capital.
It is a far more complex issue than measuring the return on financial
capital employed.
People are not passive assets whose value is constant, and whose actions and
reactions can be easily predicted. They have emotions, feelings, prejudices,
intellects and individual behaviour traits. That makes them entirely unsuitable
subjects for comparisons with those measures applied to financial performance.
People are human beings as well as human capital. By adopting the language
of the accountant, we are potentially undermining the unique contribution that
people make to our businesses.
In Cadbury Schweppes, we are committed to working together to create brands
that people love. This is why we come to work. In the end it is what we should
all be measured against.
Our success has been based on this assumption and on the belief that we
should all be measured against the single most critical output that reflects
our ultimate performance: the creation of shareholder value.
What sits behind this is a real understanding that we cannot create superior
shareholder value without working together effectively, with world-class
capabilities in sales, marketing and manufacturing, and the strategic skills to
combine these to create competitive advantage.
Faith in the process
What matters to the motivation, development and performance of our people is
that they know about and have faith in the process we institute for measuring
their own and the company’s progress.
Measurement in these areas needs to be specific, clear and actionable. In
every country in which we operate we expect all our people to get regular
feedback on their performance from their manager.
We have minimum standards of good practice that are set centrally and role
modelled from the top down. Training and development plans are put in place to
address development needs and these too are reviewed regularly.
Every manager of people must undertake a 360-degree feedback session on how
they work with others, and then take action to improve their performance in
areas of concern.
We also monitor compliance with our values and standards of business ethics,
and we take actions where we find any divergence.
Respond to data
All these measures must be actionable. If you do not respond to data being
presented to you, it serves no purpose. However, measurement is only one
element of the process.
Statistics, particularly those that attempt to make tangible the dynamics of
human interaction, are not a panacea that will ensure a high-performance organisation.
Much more important is the vision and leadership that sets clear values, and
ensures their application across the company through clear standards in
business ethics and performance.
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In a world where even five-year-olds are being targeted and measured to
drive the performance of schools, it may seem curiously old-fashioned to point
to values, business ethics and a belief in treating people properly as the
foundations for success.
Yet I remain convinced that this is the case. An obsession with measurement
alone could undermine the insight, innovation and entrepreneurial spirit that
this country requires to build the successful wealth-creating businesses needed
for the 21st century.
