Procurement, the Social Value Act and Organisational Change

Simon Cohen, Business Development Manager at Aress Software started the following Linked In conversation:

Legislation such as the Social Value Act in the UK appears to be becoming more important in public procurement – with a company’s social value/social impact seemingly having significant weight in the tendering process and directly influencing whether or not it is chosen by a public body as a supplier. To what degree is this trend toward measuring social value/social impact changing the way companies behave e.g. in terms of corporate social responsibility? What impact does this have on change management?

Heidi De Wolf, Principal OD Consultant at Future Catalyst replied:

The consideration should be three-fold in my view. First there is the Environmental impact of any change initiative. Regardless of the change initiative Change Managers/Agents are involved in there will be an opportunity to consider environmental impact, and it could be as simple as not printing off papers (digital by default) or as significant as using recycled materials for a major engineering project. 

The second is Social. Change is driven by people and people are social beings. It is important for Change Agents to consider how they involve people with the change initiative. Here too we could be talking about a simple engagement survey, which in my view is fairly tokenistic but has its place, or as significant as co-creating solutions. The less tokenistic the engagement activity, the better the ownership over the change/transformation. 

The third is Economic. Change has a significant economic imprint. When you consider change as a project, many change projects will fail as usually people throw money at creating change momentum, but rarely does it lead to sustainability. When you consider change as an important and necessary part of the fabric of any organisation, change agents will approach the initiatives with a very different thinking hat. As mentioned above, change is driven by people who bring to it their thoughts and energy, which should be the new currency for many organisations who want to embrace continuous change/ improvement. 

Only by considering these three elements will change initiatives add more long-term Social Value and help develop a culture of continuous improvement and even innovation.

Simon:

Very interesting. Of course, procurers in the public sector are looking at how their suppliers impact society e.g. through employment, CSR acts such as charitable giving, activities in the local community etc. If an organisation is not used to this kind of activity on a corporate-wide level it can create a real change-management issue.

Heidi

I agree, what is worse is that everyone - from top to bottom - should have consideration for Social Value, not just procurement. We do not only silo our organisations, but through it silo our knowledge, creating 'experts' who hoard knowledge instead of placing knowledge somewhere where people can access it 'on demand', as and when it is relevant to them. We should 'co' everything, e.g. co-learn, co-produce, co-own, co-develop etc, and truly make workplaces 'human communities' again.

Simon:

Ideally, there should be a framework within the organisation on creating social value which everyone can refer to. This framework should provide guidance on what kind of social value fits in with the organisation's values, objectives etc. and how this can be achieved. 

But at the same time the organisation has to bear in mind its responsibility to its shareholders to deliver shareholder value. Often, these two kinds of value can be at odds with each other.

Heidi:

There is nothing more powerful than aligning both value creation activities, as organisational misalignment only causes unhelpful tensions which lead to tokenism and poor performance in relation to Social Value. Social Value is not a 'nice-to-have', it is a necessity if organisations want to contribute to a stronger local and national economy. 

As citizens, your shareholders (and employees) will also benefit from any Social Value commitments your organisation makes and in an ever more consciencious society, organisations who care about the economy, the environment and people will WIN long-term!

The Strategic Strengths of HRM & OD

This blog is in response to the HBR blog 'It's not HR's job to be strategic' - http://blogs.hbr.org/2014/10/its-not-hrs-job-to-be-strategic/

Unlike the blog above, I believe HRM and HR Technology (including L&D) have a very important role in the organisation's bigger picture, supporting people within the organisation, which requires a strategic overview of how people can be attracted to the organisation and supported to reach their fullest potential. While traditionally HRM was built on McGregor's Theory X, facilitating Taylorist style industrial age organisations, today's HRM is needed to support organisational transformations focusing much more on workforce motivation, agility and resilience.

Organisational Development (not to be mistaken for L&D) on the other hand is committed to the organisational bigger systemic picture, which includes people, process, finance, IT, governance and other organisational functions. With this broadness of overview, OD helps to remove silo working mentalities. They should be seen as the organisation's 'bees', cross-pollinators of ideas. Siloed strategic thinking around one aspect of the organisation does not deliver efficiencies or innovation. This is where OD draws strategists, planners and doers together to collaborate on cross-functional innovative solutions.

OD does not hold the detail, they are solely the facilitators of collaborative strategic working practices as part of the bigger organisational picture, bringing people, knowledge and ideas together from across the organisation. This makes OD is a useful partner in partnership working with other organisations whose culture and processes may differ, as ODs expertise in Organisational Behaviour, Culture and Design supports the building of bridges and the re-designing of organisational systems and structures.

So in summary both HRM and OD have an important strategic function. The only difference is that HR is a functional strategist while OD is a cross-functional strategist.

Quick Note on Organisational Culture, Strategic Ownership and Measurement

In my experience as an OD Consultant, organisations fail to bring together Employee Relations, Employee (and wider Stakeholder) Engagement and its impact on not just Employee Wellbeing but on overall organisational performance, success and ability to innovate.

Often this can be traced back to an organisational culture which encourages the use of siloed task/project-driven strategic plans with high volumes of KPI which add unnecessary complexity, and in turn encourage the strengthening of micromanagement practices at the top. What is needed is a 'joining of dots' to simplify and make more efficient the delivery and measurement of outcomes by creating ownership over a solid outcomes-driven strategy.

Why monitoring and innovation make poor bed fellows

People always act surprised when I shiver at the word 'monitoring' (aka 'scrutiny'). I would like to take the opportunity to explain this phenomena.

When you unpick the word and activity called 'monitoring', you will uncover a number of unwritten principles, ambiguous meanings and perceptions. They include:

- Distrust: when you feel the need to monitor, it usually means you are not trusting of the source and will seek out weaknesses in the detail to prove the activity of monitoring helps to make improvements. In truth, it doesn't help improve things, it drags decision back into the past.

- Past-driven: monitoring is the activity of checking afterwards what you could have influenced earlier and made better by getting involved at the start. When 'errors' or 'weaknesses' are uncovered, the expectation is that decisions are taken back to the 'drawing board', often stopping an organization to move forward into the future.

- Expecting perfection: monitoring suggests that perfection exists and is expected. No matter how many people contribute, there is no such thing as perfection. However, the expectation of perfection in turn ...

- Installs anxiety, stress and fear: not acknowledging perfection is a myth can lead to a lot of anxiety, stress and fear, which in turn leads to poorer decision-making, more complaints, higher distrust and interestingly increased monitoring (and bureaucracy) ...

- One size must fit all: looking for perfection really is a search for a one size fits all solution, and as we know one size fits no one, leading to increased negative customer feedback which is often met by increased monitoring ...

This shows how one 'innocent' word and activity can have such a significant implication on the culture of your organisation.

If you are committed to creating a culture of innovation, start by rebalancing 'energy-draining' activities such as monitoring with 'motivating' activities such as:
- trust others for increased trustworthiness, commitment and accountability
- change your focus from past to present and future
- get involved and influence early (or get out of the way and empowering others)
- be humble
- personalise
- co-create
- experiment
- learn from mistakes

... and watch how innovation (aka higher performance) will blossom in your organisation.

So am I saying that organisations should stop monitoring? Not exactly. As with everything, it's about finding the right balance. In many organisations I have worked in and with, monitoring is the order of the day and has set a culture of distrust and high bureaucracy. The best way to think about it is the 80:20 rule. If organisations prioritise monitoring as the 80% activity, it will struggle to innovate and survive. If it prioritises innovation as 80%, the organisation is more likely to continuously improve and survive.

The World needs more Bees! - Building Healthier Organisational Innovation Ecosystems

Just like in nature where the bee population is of concern, the business world has an equal challenge. It does not unlock sufficiently collaborative cross-pollinating behaviours (aka Systems Thinking) to instigate innovation. There are a number of neurological reasons why cross-pollinators are needed in organisations.

1. As a consultant I have heard many CEOs and Directors express their frustrations with silo working, wishing people would collaborate more readily with others across departments and beyond organisational boundaries. But what if human neurology encourages most people to focus on detail, while some people prefer the bigger picture.

This is exactly the case. Every organisation needs people who enjoy working with detail and people who enjoy working on the bigger picture. The latter are the organisation's systems thinkers who can often be found at the top of the organisation or in Senior Technical roles. Rather than or as well as managing people, the System Thinkers role is that of organisational 'bee', connecting the dots and looking after the wider organisational ecosystem.

The reality is that people who enjoy working with detail actually find it very hard to think 'bigger' and 'wider', while the reverse is also true.

2. Cross-pollination is not only required to connect people and ideas, but is also helpful in connecting the lessons from the past with lessons for the future. Just like some people prefer detail versus other preferring the bigger picture, some people are naturally more past-focussed while others prefer to stick their energy into the future.

Here too, asking a past-person to be a future-person or vice versa, can actually have a significant impact on a person's happiness and well-being. It can also be noted that the past-person finds change more challenging and as such often less resilient than the future-person, as understandably the future-person is more likely to scan ahead for opportunities and challenges. Only very few people (1 in 10) can access both past and future equally, though often they still have a preference.

The same old question applies? Is this about nature or nurture? My cop-out answer is 'probably a bit of both'.

So if we actually truly acknowledge people's strengths and neurological preferences, and such acknowledge that silo working is not an unusual human trade, we can see why organisational 'bees' are so important in building an efficient, collaborative and innovative organisational ecosystem.

My next blog will build on this notion and explore the impact of valuing people's preferences differently in traditional hierarchical organisations.

Politics and the use of Positive Psychology to encourage more citizens in building the future

Recently I received an email from one or other political party which asked me to complete a short survey. Reading the first two questions reminded me of a political leaflet I got through the door a while back, which asked very similar questions, but let me come back to that a little later ...

I had the pleasure recently to speak with a few politicians about their passion for improving their community and environment. Many spoke - with possibly a little bit of rolling of the eyes - about the times they were cornered by a citizen about some dog poo or a pothole needing repair. Having a curiosity for politics, though considering myself fairly apolitical, I fully understood the slight frustration shown by the politicians.

While it is helpful for politicians to reach out to the community, their interest is or should be with the 'bigger picture'. To understand the bigger picture, politicians and the people who support them rely on high volumes of data to spot trends etc. Unfortunately, politicians have lost a lot of favour of the last decade and the voting public are predominently voting with their feet.

So how then can politicians regain the public trust? And what is it about dog poo and potholes?

The first two questions on the questionnaire were:
- Do you have a problem with dogs fowling the pavements?
- Do you have a problem with potholes which require repair?

The first question on the leaflet:
- Do you have any problems you would like your political representative to look into?

Now what is the 'problem' with these questions? The questions are built on negative psychology and negative language, and - unlike in maths where (- + - = +) - that does not make for a positive citizen response. Firstly, the questions are appealing to those citizens who are already on their 'soapbox' about one or other 'problem', which is not so much an issue. Secondly however, the questions do not invite a response from those citizens who do not have a problem, but who may have views or ideas that can really make a difference. They, at most, will tick the 'No' box if you are lucky. If unlucky, the questionnaire will find its way to the bin, which would be an opportunity lost!

Let's use a positive psychology question. For example:
- We value the views and ideas of local citizens in making our communities stronger and more resilient for the future. Do you have any views or ideas about how to improve your neighbourhood?

This question does not exclude the person who would have answered the previous 'negative psychology' questions, but what do you think could happen to those citizens who do not have a problem, but may have had an idea or two about making their community even stronger? Also, note the sublety, the question does not actually state that the politician will take responsibility for taking the problem away or making the idea work?! So depending on the view or idea, further 'negotiation' can take place about who is best-placed to make the idea work.

Rebuilding citizen trust will take time without a doubt, but what if it could be as simple as changing viewpoint and language use. Is it not worth a try?

From Street Party to Community Ownership

A few years ago, Future Catalyst instigated a Street Party 'on the green' in their local community. While the Street Party was a great success with over 70 residents joining in the fun and bringing along food & drinks to share, the benefits have stretched long after the event, and have the potential to stretch to further Community Development and possibly Ownership if the need should arise.

The benefits to date include:

- neighbours greeting each other by name
- neighbours looking out for one another
- friendships
- car shares
- skills and knowledge sharing
- exercising together
- recognition of diversity needs
- signposting to local business and charities
- dog walking for someone in hospital
- etc

All this has made the street a friendly neighbourhood, and a couple of new neighbours have been welcomed since that time. With this in mind, a few residents are getting together to plan in another neighbourly get together at Christmas time.

Recognising the power of this simple exercise, it would be interesting to see whether - with the increased use of our beautiful green - whether neighbours would agree to working together to keep the green tidy? This would venture into the arena of Community Participation and possibly Community Ownership.

With Future Catalyst's expertise in relation to the Collaborative Economy, Community Development and Engagement Models and Social Renewal, I note some definite similarities with the approach as taken above. The book 'Nourishing Social Renewal' written by Dr Dick Atkinson OBE expands on this model through multiple case examples, by suggesting costings for the approach and a complimentary organisational structure for Local Government partners, helping a move from a Welfare State to a Welfare Society.

I am sure you have heard the saying 'It takes a whole village to raise a child'. I would like to plant another seed 'It takes a whole community to offer a proactive and personalised approach to individuals within the community'. As neighbours/fellow citizens, not one of us is fully dependent or independent. Welfare, most definitely stems from being interdependent!

In the spirit of the Collaborative Economy, let me know if you would like to borrow the book! ;)