Multinational engineering giant GKN has big plans – and that means it needs a leaner, upskilled HR team
Getting lost, it seems, isn’t an uncommon occurrence for visitors to GKN. Its freshly refurbished headquarters is plonked amid the greenery of rural Worcestershire like a weekend visitor from the city, leaving many travellers circling it helplessly, the receptionist admits.
GKN says its engineering ‘moves the world’, and it bears comparison with Rolls-Royce in both scope and scale, but its profile is as low-key as its location. FTSE 100-listed, with 160 sites and 50,000 staff in 33 countries, including nine locations in the UK, £7.6 billion of sales in 2013 and a 250-year heritage, it still flies under the radar for most outside the sector – which is ironic, as its groaning inventory contains the metallic coatings that boost the stealth capabilities of fighter jets.
There’s more besides: GKN manufactures chemicals, components and electronic systems for defence, aerospace, agriculture and automotive markets, among others.
“If you’ve been on a Boeing passenger plane recently and looked out of the window, it was a GKN window,” says Doug McIldowie, the firm’s group HR director and a man helping deliver some grand plans. GKN is targeting developing markets in Asia for its future growth, and McIldowie says great leaders are the bedrock of its aspirations. HR is running three leadership programmes with a common thread: to develop individuals who are authentic, believable and that teams can trust and follow.
“If you have a good leader, things happen,” says McIldowie, who joined in 2005. “Quality is assured, customers are happy, employees are engaged. We assume that all of us have the functional competencies to do the job, but that’s not enough. You want leaders that people will follow, buy into and are engaged by, so people will get behind them and give discretionary effort. It’s the only thing that’s really sustainable.”
Things haven’t always looked so rosy for GKN, named after its 18th century founders Guest, Keen and Nettlefolds. When the financial crisis struck in 2009, sales collapsed by 60 per cent, forcing drastic measures including 14,000 job cuts and the closure of nine sites.
McIldowie says: “The message from the firm’s leaders during that time was: ‘We’ve got to do some tough things but if we manage the downturn well we will be successful on the upturn.’ So even at that time when things were really bad, you have to give people a view of the future, their future.”
Judging by 10 per cent annual sales growth and ambitious expansion plans, it seems this brand of authentic leadership is working. But GKN knows it has to find, develop and retain the brightest minds, and compete for engineers at a time when many believe the market faces a potentially damaging war for talent. How will McIldowie help it expand with confidence?
Behave and they will follow
GKN has a strong focus on developing the correct leadership behaviours, to help managers build relationships with their staff and smoothe cohesion. McIldowie says the company wants more from its leaders than just functional competence: “We expect them to behave a certain way and lead a certain way, the GKN way.” This means developing each leader as an individual to be authentic, believable and trustworthy. “That way people will follow you, they’ll be engaged and give more and the results will be better,” he says.
To ensure a common approach across the business, HR runs three leadership programmes: ‘Essential leadership’, ‘Advanced leadership’ and an executive programme called ‘FED’ (future engage deliver). They are open to all leaders across the organisation, from first line supervisors to the CEO.
McIldowie says: “We absolutely expect them to work that way. They’re supposed to be themselves but understand their responsibilities on how they lead. Engagement is built around that trust in leadership that your leaders are telling you the truth.”
Great leaders engage
There are a number of differing philosophies around the frequency of employee surveys, from adherents to an annual mega-poll to those who favour ad-hoc ‘pulse’ surveys. GKN takes a monthly approach, selecting staff randomly at each of its 160 sites to talk about how things are going at their workplace using the firm’s ‘positive climate index’ (PCI). This entails 16 questions that staff answer in real time, followed by prompting questions from divisional leaders into the issues raised and potential actions. “The questions are a way to start the conversation as well as making the leaders more visible and more real, and able to interact with real people and talk about real things,” says McIldowie.
Discussions can cover many different topics. “In some places it might be that the toilet window is broken, in others a lack of equipment. There are a thousand and one things.” The framework gives employees a voice, and if leaders don’t act, there will be another group along to ask questions the following month.
PCI scores land on McIldowie’s desk from all over the world. But he says: “It’s not so much about the score, it’s about are they getting better, are they getting worse or are they all over the place? It’s an early indication of an issue.”
Get HR into shape
GKN’s expansive strategic plan aims to add millions of pounds of value over the next four years, and HR-led programmes will play a major part. But McIldowie has his eye on ensuring HR develops itself as well as the rest of the business. “We are really business people in HR. We are not always at the leading edge of HR like others companies you could name, but I really believe we are very close to the business and helping it deliver the strategy. That gets us a lot of credibility as leaders, but you have to earn your way.”
It’s why McIldowie’s HR development plan means “smaller numbers but higher skills” alongside a shift towards a more strategic focus. It will bring a potential change in the HR-to-employee ratios, from 1:120 to 1:200.
“We do a lot of transactional stuff,” he says. “We want to get better at that so we spend less time doing it, then we can move more people towards being the best leaders they can be and that means more coaching, challenging and developing. Those future competences are the ones we need to develop.” HR will ask 50 leaders across the business: ‘what are we looking for from HR?’, ‘what are you getting?’, and ‘what do you need in the future?’ The answers will be matched with an HR self-assessment skills inventory, and the results will inform how the function develops.
Shout about opportunities
Expansion plans aren’t possible without a healthy flow of talent. McIldowie is concerned that a lack of employer brand – “We go to universities and they don’t have a clue who we are” – could be a handbrake on GKN’s ambitions. The business hired a new director of group communications in 2012, and is now sending young advocates into seats of learning to recruit the next engineering innovators.
“Once people join us they tend to stay because they find our environment friendly, challenging and fun. You can have a career with us and go anywhere in the world, but not if you don’t know who we are,” says McIldowie.
Part of ensuring the talent pipeline stays primed is about filling vacancies internally. “Three out of four of our management jobs are filled internally and I’m proud of that. But it’s a bit of a challenge for HR because you’re developing more of the same type of people when what we are looking for is difference as well. When we have opportunities, we’re not going to positively discriminate but we will be more demanding around seeing more diversity in candidate lists, graduate recruitment and things like that.”