Despite the fame of its products and its symbol – the rotund Monsieur Bibendum – Michelin is a company shrouded in secrecy. It is still part-owned by the Michelin family, but when I ask for figures, head of personnel and training James Alderman says: “We don’t know. Nobody knows.”
Michelin facts and figures
While a century ago, Michelin showed it cared through the paternalistic treatment of its staff, it does so now by making sure they know what they are contributing to the company – what their work means. For some years they’ve been running the ‘Michelin manufacturing way’, which aims to show how a responsible organisation involves its people in its processes.
Alderman says: “Fifty years ago, people were very restricted in what they could see of the business – now they can see the whole business, and are briefed by everybody from the managing director to external experts. They can see the impact their work has on the business.”
This transparency extends to both good times and bad, the latter of which Michelin in the UK has seen plenty of over the past decade. In 2000 the company’s Burnley plant closed, with the loss of 450 staff. The same year saw restructurings in Stoke, leading to a further 1,700 compulsory redundancies by 2002. While the negative impact was undeniable, the company also saw this as an opportunity to really understand how their staff thought.
Alderman recalls how, a year after the redundancies, a group of those affected were called back to Michelin, to discuss the experience and how the company had handled it. He says: “The feedback was very good, in terms of the process we’d used. But it was also a very useful tool in helping us understand the emotions people were going through, so ensuring we do this sort of thing properly.”
Alderman likens Michelin to Rowntree, a company historically associated with cradle to grave care for its staff. While today’s Michelin draws the line at company housing and places of worship – Alderman says that level of involvement would no longer be socially acceptable – it has gone to some lengths to look after those made redundant.
Personnel v HR: The Michelin standpoint
Why does Michelin insist on the slightly old-fashioned ‘personnel’, long since forsaken by most other companies?
Alderman says: “It’s all about the people. Our personnel department is not a department at the end of the telephone – it is integrated into the business. We have our personnel managers in each level of the organisation’s structure. It’s not just about having an HR director on the management team.
“If I go to Ballymena, there’s a site personnel manager there, part of their management team. They’re not just dealing with HR matters – they’re part of a decision-making process on everything.
“They know the jobs and the people on their sites very well – it’s quite an advantage for them. That’s why we talk about personnel rather than HR.”
The Michelin Development Company was set up in the wake of the Burnley and Stoke redundancies, its aim to create as many new jobs as were lost. Its modus operandi is simple – to provide funding and advice to local companies able to offer positions to staff made redundant by Michelin. With a £5m pot, they’ve already helped create more jobs than were lost in Burnley and are close to achieving the same in Stoke.
“This is about our belief in people, and us committing to the local community”, says Alderman.
Michelin is an ‘unlimited liability company’, meaning its managing partner is personally responsible for its debts. This not only has tax benefits, but means the company is, in Alderman’s words, “effectively bomb-proof in terms of a takeover”.
This security, he says, means Michelin is “able to have a more long-term view of things than certain plcs”. And the long-term business approach ties in well with their HR strategy, which is very much one of looking for long-term potential.
Michelin prides itself on recruiting for potential rather than specific positions, and employees can expect to have several distinct careers with the company. Lacking a formal graduate recruitment programme, it puts graduates into key account manager and sales manager positions, as well as customer service roles.
Alderman says “It’s our way of taking people with potential to do a lot more and moving them through those areas of the business.” If the economy continues to improve, the next foreseeable people problem for Michelin will be one of demographics. In five or 10 years, the company will see a significant number of staff retire.
Tyres and restaurants – unlikely bedfellows
The casual observer might wonder about the connection between tyres and the much-coveted Michelin stars awarded to top restaurants each year. It started with the Michelin brothers, André and Edouard, who founded the company in 1889.
Well-known foodies, they decided to share their records of the best places to eat and sleep while on the road. Early UK-based travellers would write to the Michelin offices on London’s Fulham Road, with their journey’s start and end points.
Staff would write back with an itinerary, including suggested hotels and restaurants. So while the technology may have changed, the practice remains much the same – and the reasons behind the two strands of the Michelin business become more apparent.
Alderman and his team have anticipated this, and are mapping the company’s global staffing situation, based on retirement age. They are looking at staff numbers by profession and location, attempting to pinpoint potential difficulties. Depending on the results, they will decide whether it’s necessary to “put in place some people who will grow”.
Michelin UK and Ireland’s turnover rate is an enviable 4%. As Alderman admits, it would be easy to be complacent, but he is well aware of the immediate challenges, and says: “We have to keep up-to-date and proactive. It’s about the buttons that need to be pressed in terms of engagement and retention.”
He mentions the added difficulties of recruiting for industry when people are more likely to opt for a job in the service sector, saying “You’ve got to make sure people understand industry is very different to how it was 50 years ago, as a place to work.”