Project Description

High Performing Organisations – With Gabrielle Sullivan and Sonia Lynch

HR Managers know that people are the key to becoming a High-Performance Organisation. How can HR Managers contribute to high performance and does Australian employment law help or hinder HR Managers in their quest?

Today our host Genevieve Jacobs is joined by Sonia Lynch, who is head of HR at Epicon. She has worked in a variety of industries helping companies on strengthening engagement, leveraging diversity and inclusion, investing in leadership capability, realigning company culture, and that’s included significant change management too.

We are also joined by Gabrielle Sullivan who is Director of Employment and Workplace Relations, at BAO lawyers and an accredited specialist in employment and industrial law.

For more resources, see our HR Breakfast Club resources below. If you have a topic that you would like us to discuss, we would be happy to hear from you, please contact us!

Some topics we cover:

  • What constitutes a high-performance organisation
  • The importance of culture when striving for high-performance
  • Finding the right staff to support the culture you’re supporting
  • It is not just financial success that enables high-performance, in fact sometimes focusing on this can be a hindrance to achieving your goal
  • How to transform a workplace
  • Change takes time and careful consideration

Genevieve Jacobs: Hello, I’m Genevieve Jacobs. Welcome to the HR Breakfast Club podcast where we focus on the world of work in Australia with a legal spin. Through that prism, we’re looking at HR issues that you might be facing in the workplace, important information, possible pathways for sorting them out. Our website is hrbreakfastclub.com.au. and if you’d like to make contact with some questions, we can respond to those as well and keep you updated on recent developments in the field.

In this episode, high performance. It’s a goal for many companies who look at the Googles, the Netflix’s of this world and think, “I’d like a piece of that, but how do I make it happen and how do I manage my staff through that transition?”. Now, change can often be hard and there are risks in deciding to reorient your goals. How does the Australian employment law fit in with this kind of workplace challenge?

[music]

Any manager worth their salt wants their organisation to be the best performer possible but getting there is the trick. So, to discuss how you can do so effectively and fairly, and what the risks are for your organisation along the way, I’ve got with me Sonia Lynch, who’s head of HR at Epicon. She’s worked in a variety of industries helping companies on strengthening engagement, leveraging diversity and inclusion, investing in leadership capability, realigning company culture, and that’s included significant change management too.

Gabrielle Sullivan is with us too. She’s Director of Employment and Workplace Relations, at BAO lawyers and an accredited specialist in employment and industrial law. Thank you both for joining us. Sonia, let me start with you. What is a high-performance organisation?

Sonia Lynch: Well, you would think that was an easy question to answer, but there’s been a lot of research into it and a high performing organisation is one that consistently outperforms its peers, both financially and in non-financial goals for a period of over five years or more. It’s an organisation that has aligned its strategies, goals, employee lifecycle, and measures and monitors, and then outstrips its competitors.

Genevieve: I’m interested in whether the financial component comes first, whether that’s the only outcome that you’re measuring when you’re looking at a high-performance, workplace, and culture.

Sonia: It isn’t because quite often, productivity and financial results are linked to employee engagement. What you’ll find with high-performance organisations is that they are measuring many different things. So, they’ll measure financial performance, they’ll measure employee engagement, they’ll measure customer satisfaction, quality of the product, and innovation because they’re the key things that are going to drive their organisation forward.

Genevieve: It would seem to me that there’s something of a risk in seeing financial outcomes as the only indicator because what you’re doing and the financial outcome are not always the same thing are they?

Sonia: No, absolutely. If you look at Enron, you’ve got a perfect example of that. [laughs] I think Peter Drucker is one of my heroes, and he famously said that, “culture eats strategy for breakfast”. I think that’s really the crux of it because if your organisational culture is not aligned to your strategy, then you can still be making a financial profit but you can have places not very nice to work in, that doesn’t give great customer satisfaction, and generally, is not perceived well within the marketplace as a brand.

Genevieve: Gabrielle, I would imagine a place that’s not very nice to work in is also a place where HR and employment law-related issues can, therefore, come bubbling up. If people are unhappy about where they’re working and how they’re being driven, then that’s the kind of place that can cause problems.

Gabrielle Sullivan: Absolutely. Absolutely. Unhappy employees, make complaints, lodge grievances, take stress leave. Absolutely trying to keep them happy and engaged is critical to the success of a business.

Genevieve: Sonia, what kind of people, are we talking about that fit a high-performance model? If you are thinking about transitioning, what kind of measurements are you passing across your workforce to say, who fits in and who perhaps doesn’t?

Sonia: There are two aspects to that. Firstly, there’s clearly understanding what the skills are that you require in order to drive your organisation forward to be a high performing organisation. Then there’s also the behaviors that are going to help you get there. If I was to paint a picture for you of a high performing employee, it would be somebody who likes to go to work, they enjoy the work that they do, they find it challenging and meaningful, they understand how they contribute to the organisation’s success, and they feel recognized and rewarded for their efforts.

All of those things add to the commitment that the person feels to the organisation. That then flows into their productivity and creativity which often drives these organisations forward.

Genevieve: So those people will perhaps already be in the workplace?

Sonia: Yes. Quite often, you’re looking at talent that’s probably got good experience in other organisations that they can bring to your organisation.

Genevieve: Gabrielle, thus far, and we’ll talk more about this in just a moment, but thus far we’re talking about this from an employer’s point of view, from the point of view of management, the ideal world in which they want to transform their workplace into somewhere that’s high performance. Now, there’s a legislative and regulatory framework that surrounds all kinds of transitions. So, what are employers and managers bound to do in the workplace while they’re trying to effect change? what governs that?

Gabrielle: That’s a really good question, Genevieve, because in my experience, forgetting to call in the framework leads to error because the framework’s a little bit complicated for HR managers. There are at least five parts to that framework. Quite often, I see a couple of parts to that framework got overlooked, and that leads to legal disputation. Just quickly to read through those, the first part of the framework is the contract of employment, either written down or oral. Secondly, it’s the HR policies that the organisation has chosen to adopt.

Thirdly, it’s the legislative background, like the Fair Work Act, like the Work Health and Safety Act, discrimination statutes, and so forth that most HR practitioners are aware of. Fourthly, you’ve got the award framework that will apply to some but not necessarily all of your employees. Lastly, if your organisation has chosen to adopt an enterprise agreement, that will take place at the award. So, whatever provisions you’ve got in your enterprise agreement, you have to make sure you comply with. Sounds simple but the point is you have to cover up, HR managers need to ensure they are compliant with all five of those to avoid being toiled in claims of unfair dismissal, adverse action, bullying, etcetera.

Genevieve: It sounds to me as if it would be a really good idea to have a look at that HR framework before you start implementing major change. You might have all kinds of big goals and great ideas but you really need to sit down beforehand and see what you’re dealing with. Would you agree?

Gabrielle: Absolutely, and if my clients did more of that more often, I’d be almost out of a job.

[laughter]

Genevieve: Sonia, back to you, so the decision’s been made. We’re going for being a high-performance organisation. What are the mechanisms you can use to reach those goals? How do you transform a workplace?

Sonia: Well, consultation forms part of your legal framework, and you have a requirement to consult with your employees about organisational change. I think its good practice too anyway. You could start by talking to your employees around why is there a need for change? What does that change potentially look like? Give them an opportunity to have input into the framework of that change. Collaboration and inclusion really help to drive change and embed change more than a top-down approach. Certainly, this is what organisations like Google, Facebook and the other big organisations that companies are aspiring to are very, very good at.

Clear direction, clear communication, two-way dialogue. Working groups work very well as well in terms of getting that two-way dialogue and having milestones for achievement. But change is not something that happens instantaneously. Change needs to embed as well, and so it’s having a program that’s going to help embed that change for it to take place and you to be able to measure with the results.

Genevieve: Hang on, Sonia. One of the great truths of management is that people hate change. Even people who would really do this well will often resist at first.

Sonia: I think one of the things that I have found that really helps when running a change initiative is to explain to people, how change impacts us as human beings and why they may feel the way they do. That fear factor when you suddenly find that you’re going to change, takes the facing of change. Why do you feel that fear? What’s driving it? How can you overcome it?

I think inherently that our first response to change is, “I’m not going to be good enough. I’m not going to be able to do this. I’m scared,” and packing that and giving people emotional support to understand why they feel that will again help the change to be smoother. You also need to understand that there will be those people whose barriers to resistance may be absolute downright denial, “I’m not going to get engaged with this.” Then you’ll get those that say, “Yes, yes, I believe it, I believe it,” but they will not and actually will be derailing your change. People are complex. If people weren’t complex, this would all be easy.

[laughter]

Genevieve: One of the real challenges here, though, is that if you’re effecting change towards high performance, and that hasn’t been your workplace model, you may well have people who are perfectly good at what they do here and now but do not fit the change model. Some really serious questions need to be asked about how those people are handled. Gabrielle, if I can go to you on this, what is fair and reasonable when a person doesn’t fit the change model? How do you need to treat them in that situation? What rights and obligations does an employer have?

Sonia: I guess that’s a tricky one, Genevieve, because every workplace is going to be different, and every employee and the facts and circumstances are always going to be different. Having said that, I guess some tough decisions need to be made about whether the employee is going to be able to be re-skilled, trained up, transferred or whether, really, the organisation’s moving to a new phase, and it’s really time to have some honest discussions about redundancies, et cetera.

Every case will turn on its facts as to what’s appropriate, but obviously, if you want to get to the end goal of being a high performing organisation, then you have to make sure all your staff are on board with it. If you’ve got enough evidence to demonstrate that some of them aren’t, then leading it unresolved is going to mean the organisation doesn’t meet its goal of becoming the high performing organisation that wishes to be.

Genevieve: I guess, Sonia, this is the real nub of the question, isn’t it? Because if you are transitioning away from the workplace model that you’ve had, then if you can’t bring people along with you, you are facing a question about whether you lose those people or you compromise your goals. That’s a very hard one to do from an HR sense too.

Sonia: It is and I think it starts though with clarity of expectation, ensuring that in this new paradigm, everybody understands their role, the expectations of the organisation, what good performance looks like, and then measuring people in that new environment. Will, it then enable you to see who’s actually cutting the mustard and who isn’t, and then you have also some concrete evidence as well to support the idea or thought that the person is not going to be able to adjust to the new world. It is a difficult thing to do, and it’s quite often where organisations don’t put enough effort, but everybody needs to understand their expectations so that they can perform.

Genevieve: Gabrielle, what’s the role of performance management in a legal sense within the legal framework in managing that transition towards high performance, perhaps particularly with regard to people who may very much not have been expecting to lose their jobs or need to move on?

Sonia: Well, I probably should start and just put that statement in context, and that is that performance management or managing underperformers is but one tool within a much broader tool kit available to HR practitioners to try and create a high-performance culture. It really comes in at the end, after, say, your probation processes have failed. Ideally, you would be recruiting high performers right from the start, right? Occasion your recruitment process lets you down, then you’ve got a probationary period, during which we can all assess how that employees performing.

If for whatever reason, employers have missed the boat on that one, and they’ve got six or 12 months to do so depending on whether they’re a small business employer or not. Then if that employee’s retained in employment and the underperformance persists, then it’s only after those steps have failed you, that you would even be considering performance management, as such. It really comes at the end of a process as it otherwise failed, because probably the most important point that HR managers will be well familiar with is that managing performance is really about ongoing good management.

If you’re having the honest conversations day in day out, there really shouldn’t be too many surprises at performance appraisal or review time. What I see though in my practices, those conversations are routinely avoided, and then the under-performance problem festers, and it’s allowed to continue. It becomes the norm, and then when a new supervisor comes in and says, “Hey, this is not good enough.” This is news to the employee. “I’ve been working here for years, nobody’s ever told me that what I’m doing is not good enough.” You can see the legal conundrum that’s about to unravel here. The employer is not happy, the standards, nonetheless, not good enough, but we’ve led the employee to believe that they have been performing satisfactorily, and so that’s a difficult situation unpack, but it shouldn’t be used as an excuse to allow underperformance to continue.

Genevieve: I’d like actually to talk about the risks because clearly, that’s a really major risk that someone who has never been guided through the aspects of their performance that might be problematic, then has no basis for understanding what’s taking place, and that’s where disputes occur. Sonia, maybe I’ll ask you to talk to that idea around the steps towards managing somebody out of that role.

Sonia: When I mentioned it, I was talking in the context of an organisational change. If we were to go through a scenario of your organisation puts in more measures for all sorts of things, and there’s greater transparency around what is being measured, and then people don’t like the idea of being measured, and there is resistance to that, and that is the change in way in which you might start to see some of the evidence in your performance management process, and that’s where expectations are important, and why clarity of around roles and responsibilities is important and why continuous review is important.

Unfortunately, it comes with all sorts of difficulties that like Gab has mentioned, but one of the ones that I think often rears its head and can become contentious, is where you do have the new manager who comes in and starts to measure, evaluate, performance manage, and the individual hasn’t been held to account previously, and then you might end up with the situation of, “My manager is bullying me.” Classic guise for which they might seek some guidance from Gab around. That’s a very difficult situation, not impossible to deal with as long as you seek advice and you are stringent in your processing and processes and documentation.

It’s staying true to the cause, the longer-term cause, which is the high performing organisation, and continuing on that route and not letting the difficult steps derail you from the direction in which you need to travel.

Genevieve: Is it, Gabrielle, let’s be clear about that about the size of those risks. Sonia has outlined a scenario there in which there’s a possible bullying allegation, which is really grounded in people having been anxious about or failing to do their jobs earlier on in the process. Now, if that scenario develops, derailing is maybe a mild word for what can happen to the change process, isn’t it?

Gabrielle: It can certainly do rival crisis, that’s for sure. I agree with you, Sonia, that the standard response to a lot of underperformance management processes is number one, put in a bullying complaint against the manager who’s had the audacity to start it or number two, putting some stress leave applications. So, I agree with you that’s a potential derailer. In terms of the magnitude of that risk, I agree with Sonia it actually can be managed. Can I say it’s a huge weight on the mind of a lot of my clients, if you’re a middle manager, and it’s your job to make your organisation into a high performing organisation and you know the people that need to change to make that so, then it’s their responsibility to manage that. That is a difficult job. For two reasons at least.

One is because who wants to be the bearer of bad news? We always avoid conflict if we can. Number two, the legal process is perceived to be complex, one part of which is that you’re lucky to get a bullying complaint against you. I mean, I practice in Canberra. Public Service, of course, is one of the obvious big industries in this town, they’re very common. It’s very common that that will happen and it’s unpleasant. The trick there, though, in terms of how to manage that is just be really clear on what bullying actually is because we now have a definition. We haven’t had one up until 2010, but we’ve now got one. It’s in the fair work deck and it says it’s repeated unreasonable behavior. For what that’s worth in terms of trying to be helpful, but you can say that the touchstone there is reasonable behavior.

If you’re a manager, and you treat your employees going through this unpleasant performance management process, or change management process for that matter, in a reasonable manner, you are likely to avoid claims of bullying or even if you don’t avoid a claim of bullying, you would at least be able to defend it, because you’ve acted reasonably. The question then becomes generally, if you’re going to ask me. “Well, what’s reasonable?” Right. Fair enough. Good question, but you’re probably in as good position as me to answer that because reasonableness is an objective test. What is a person observing that situation, who knows all the relevant facts, what do they think is fair enough?

If you’re a manager, it’s your job to make that call, my advice to you is get a second head on it, because if another person thinks you’re a little bit out of line there. You’re being a bit harsh, then two heads are better than one in that regard. It might help you discharge that objective test of unreasonable behavior to have a second set of eyes by somebody you trust as to whether your management of the scenario is frankly, a little over the top.

Genevieve: I think that would go back to what we talked about, really at the beginning of this discussion, which is have a look at the framework for change. Have a look at how you want to achieve this process. Think it through before you begin the process, and Sonia, you nodding vigorously there.

Sonia: Yes, absolutely. I think it’s the military that says, poor planning equals poor performance, and I think that’s really very, very true. I tried to not only just plan a change process but also think of all the different potential scenarios that are likely to impact and prepare for those and that includes giving managers training on the things that they are likely to encounter. So, educating them on what’s happening to their people as they go through change. What happens to people when they start to be measured, not being fearful of employees having a voice because that’s one of the things that are crucial to a high performing organisation, is that people are able to challenge without repercussion, make mistakes without repercussion because these are the things that drive change and innovation but as a manager, that can sometimes feel very uncomfortable.

So, educating and training and coaching and supporting on those things that they’re likely to encounter will have them to feel more confident in supporting the change as well as the employees.

Genevieve Jacobs: Finally, Sonia, how should a successful transition towards high performance feel for employees? What are the benefits for them in making the change?

Sonia: I think the benefits for the employee are really, they are around their own engagement with the organisation. They will feel comfortable because they don’t believe that there’s any secrets. There is transparency of communication. There is a sense of belonging because they understand the part that they play in the organisation and direction of travel, so they know that in five years’ time, we’re going to be the leader in IT solutions across integrated platforms just as an example and how they contribute to that.

I think security, engagement and a sense of doing something that is valued will be the key things that they’ll start to feel. I think that really does help people to feel happy in a workplace.

Genevieve Jacobs: Thank you both so much for your time. This has been The HR Breakfast Club Podcast. We’ve been looking in this episode at high-performance and some of the workplace issues that surround it. Our website is, hrbreakfastclub.com.au. Please make contact with some questions to find other podcasts on other workplace issues and join us again to stay updated on recent developments in the field.

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