Why your board has a crucial role in solving your talent shortages

A famous Dilbert cartoon strip from the 1990s is still wincingly accurate if you’re looking at the barriers boards can pose to the success of a company’s talent strategy.

Dilbert’s boss announces that, despite years of claiming “employees are our most valuable asset”, he was wrong. In fact, he says, “money is our most valuable asset”. Employees are actually ranked ninth.

The humour conveys a universal truth: paying something lip service won’t make it true.

In the current economic climate, every board is scrutinising their costs. And both the tightening labour market and growing employee demand for meaningful employment, are having serious implications for corporate performance, productivity and profitability.

Boards have a superpower – they should use it.

The good news is an enlightened board has a superpower available to it with which to remedy the situation. But that superpower can only be unleashed if the board genuinely believes, unlike Dilbert’s bosses, people really are the company’s biggest asset.

The power lies in realising the business strategy and people strategy must be entwined and embedded throughout the board’s thinking and its priorities. They can no more be separated than can the twin strands of the DNA double helix. And, as with DNA, the structure is essential.

It’s what we’re trying to do at Phoenix. As the UK’s largest long-term savings and retirement business, our purpose is clear: to help people achieve “a life of possibilities”.

Our strategy – for our business and for our people – flows from this through a simple but powerful formula: be purpose-led and people-focused.

Our people strategy is equally direct. We want all our people to be able to claim genuinely that Phoenix is “the best place we have ever worked”.

Achieving those twin goals depends on having the right structure to support them – our target operating model. Following rapid M&A-driven growth, we have accelerated progress towards this by prioritising several quick win initiatives: simplifying our committee governance structure; enhancing our office environment; investing in technology to support greater levels of hybrid working; and removing inefficient processes.

With the structure in place, we then have to attract the right talent into it. That means enhancing our employer brand externally and pivoting to a direct recruitment model which makes us much more agile in hiring top talent.

Adapting to new workplace dynamics

Conventional wisdom suggests company culture changes from the top down, with employees adapting to the cultural ecosystem determined by the senior leadership. But today’s workforce is fragmented, and culture is more individualised. One of the side-effects of the pandemic has been increased atomisation, the formation of microcultures around teams. Effective culture change work has to be led both from the very top and by every leader you have.

The simple truth is that people are more motivated and inspired by their immediate managers, with whom they have daily contact, rather than the more remote board.

But humans have always thrived on stories that make sense of a complex world, on compelling narratives and a sense of greater purpose. The board remains responsible for telling that story. Our cultural challenge today is to combine that workplace narrative with an approach that is sensitive to individuals.

Back in the 1960s, the then president of the Ford Motor Company, Robert McNamara, memorably captured why the board’s role in getting strategy, structure and culture right were the secret to winning the war for talent: “Brains, like hearts, go where they are appreciated”.

The strategy is the vision we have for the business. The structure is the model, the organisational design, we adopt to realise that strategy. But the culture is what gives it all meaning – the philosophies, values and behaviours that add up to the personality of the company.

If our leadership can create the mood board for our culture – and embody it themselves through thousands of daily small acts – then that culture will pervade the organisation.

At Phoenix, the board sees our people strategy as an integral part of the business strategy. The people strategy is owned by every area of the business, not just the HR department, crucially ensuring that our cultural evolution is embraced by everyone rather than done to them.

The process never stops but we are reimagining the world of work and workplace culture in ways that allow strategy, structure and culture to become more, not less, than the sum of their parts. Our board believes that our people really are our number one asset. They are using their superpower.