Mar 192015
 

Proving the Business Value of a Strong Organisational Culture: Four Keys to Serco’s Success by Chartered Director Robert Smith

chartered directorRobert Smith, Director Assurance at Serco Group PLC (Serco), shares his thoughts on how he and his team are helping Serco build and sustain a strong organisational culture that reduces reputational risk, and better protects the business. Serco is an international service company supporting government and private sector customers. The company has more than 100,000 employees in over 30 countries. Robert has been with Serco since 1989.

About two years ago Serco was confronted with a number of reputational challenges that resulted in lost confidence from some of their key customers in the U.K. To urgently address these issues, below, Robert tells us how Serco developed a corporate renewal programme to increase awareness of their business values and bolster their corporate culture from the inside out.


I am often asked what the business case for ethics is and I simply reply, “reputational risk management.”  The root causes of many reputational failures are ethical or cultural failures. I’m not alone in this sentiment—many surveys, including a recent one by Deloitte, places reputational risk at the top of their surveys of strategic business risks.

At Serco, we needed to take strong steps to create a stronger organisational culture of ethics and respect. As a first step, we had NAVEX Global’s Advisory Services team undertake a culture and ethics assessment across our business. The assessment not only confirmed what we knew, but also raised a number of issues that we had been blind to.  It challenged our views and made us think—something we all need to take the time to step back and do.

Our focus was really culture rather than just compliance. I appreciate that compliance programmes are important to provide the sound foundation for an ethical culture.  For me, however, the focus should be much more around the behaviours of leaders, the clarity of values and purpose and aligning the two.  It’s this alignment that will truly shape and change the ethical culture and characteristics of an organisation. Our focus has certainly shifted in this direction.

You would think that with such a clear business case it would be an easy journey—but that is not the case. Change management for organisational culture change is a major challenge.

Key to Success #1: Be Louder Than the Noise

For me the main challenges have been about being heard amongst the noise.  Any business crisis drives a whole stream of initiatives, with ethical and cultural change being just one.

However, we know that a culture of ethics and respect must be embedded throughout an organisation—not thought of in a silo that is solely the responsibility of those with “ethics” in their title.  We took a strategic focus that attempted to ‘join the dots’ across a variety of initiatives covering  employee engagement, talent management, business operations and corporate communications and identified a number of different channels for engagement (print, web, webcasts, forums, training etc.) to ensure consistent and clear messages were getting through.

Key to Success #2: Take it From the Top

As part of a broader leadership and talent review we aligned to a new leadership model which doesn’t just define leadership competencies but also the behaviours that are expected from leaders at all levels through the organisation. This was supported by training, not to teach leaders ethics, but rather that effective ethical leadership is a competency to be developed—just like any other business competency.

For us, the focus of development was around getting our leaders to recognise the impact they have on the ethical culture of where they work, and to improve their decision making.  We looked at external case examples of good and bad behaviours by leaders, and the impact they had on the culture and performance of an organisation.  This enabled real debate and consensus around how we want leaders to behave, and the working environment they can create.

Key to Success #3: “Know it. Use it. Live it.”

Supporting this leadership development training was recognition of the need for greater engagement with all employees.  Building trust with our customers is one thing; we also needed to rebuild the trust of the 100,000 employees who work for us.

Our first step was to completely revamp our code of conduct.  Not to change the rules, but to change the way we present them.  The refreshed code, which we’ve titled “Know it. Use it. Live it.” reflects a completely different tone.  It is not just about what “you” need to do. It outlines Serco’s responsibilities alongside what the company expects from every employee: “you” equals “all of us.” We also changed the language used to make it simpler, clearer and more direct, avoiding “legalese.”


Related article: What’s In Your Code of Conduct?


We also spent time on the structure of the code of conduct so that it becomes a way of actively thinking about what we need to do and how we need to behave—how to live our code of conduct.

The document is supported by a web site with 92 interactive dilemmas, a number of animated learning tools and direct links to policy documents, guidance and other toolkits, such as the U.K. Institute of Ethics “Say No” Toolkit, our decision-making guide and a simple flow chart showing how to raise issues—and what happens when you do.

And recognising that one important element of trust is transparency, our code website is a public website which anyone can view.

Key to Success #4: Recognise that Change is a Continuous Journey

We all know this is a continuous journey. Each day we continue to strive to stay true to our ethical compass, and we have learnt the importance of putting ethics at the very centre of our corporate agenda.  Four of the strategies we’re using to make sure we’re staying on track for the long-term are:

  1. Consistently challenging our purpose and values. As with our code, it is not about changing the core principles, but rather looking at the language we use so that we better engage with a modern day workforce.  We engaged our leadership with this thinking.  Not as a siloed ethics initiative, but alongside and core to the output of a business strategy review.
  2. Continuing to build our leadership training with greater focus on leaders’ decision making, particularly under challenging circumstances.  It’s about getting them to apply the tools we have to strengthen their decision making, the way they perform in meetings and the impact they have on those around them.
  3. Changing our leadership model and our performance review process. Our assessment will not only look at the ‘what’ an individual has done—which has been the historical focus of performance reviews – but also the ‘how’. And to remove subjectivity the leadership model provides examples of good and bad behaviours that might be associated with all elements of the model.
  4. Improving employee engagement to more quickly identify and address pain points.  We continue to improve employee engagement, and we’re taking the time to better segment the data we get from employee engagement surveys. This allows us to proactively plan better forms of intervention. We need both a rigorous set of policies and frameworks and an equally strong commitment to driving a sense of humanity at work and creating closer connections.

Final Thoughts

Inappropriate or unethical behaviour is not just down to bad apples.  More, it is likely that a series of connected events create a perfect storm.  Rules and regulations alone will not encourage the right behaviours.  The less we are listening to all the signals, the more we will miss and the harder it will be to galvanise people and rebuild our organisation.

We are trying to apply rigour, transparency and operability to our systems with the introduction of new programmes, processes and procedures. But critical to the continuing successful embedding of these systems are our people.  We need the willing collaboration and consistent application of these processes and measures by everyone in the organisation.

Developing 100,000 willing followers in Serco may take time, but the outcome will be an engaged and productive group of people who are proud to work for Serco, and who will play a significant role in building trust, ensuring that we sustain a culture of ethics and respect, and ensuring Serco’s reputation continues to deliver the significant business value we know that it can.


For more from Robert and Daniel Kline of|NAVEX Global on training strategies that work, watch their webinar, “Ethics & Compliance Trends Across EU & Beyond: Advancing the Trust Agenda and Maintaining Programme Momentum.”

Aug 072014
 

A holistic approach to risk management amidst global uncertainty

rma

In today’s fast-moving, complex environment, risk executives must cultivate an understanding across all risks and
businesses. Business problems are multifaceted, interrelated and increasingly global. Executives must possess enhanced skills to identify and address a wide range of risks with an integrated approach and enterprise-wide perspective.

The RMA/Cass Business School Advanced Risk Management Programme exposes participants to a rigorous, yet inspiring blend of theory, practice and cutting-edge research, instilling knowledge and skills applicable to the real world of global business. In addition to its focus on known and quantifiable risks – credit risk, market risk and operational risk – the programme also concentrates on those risks which are unknowable and difficult to measure – business risk, strategic risk, and reputational risk. Cass has excellent links to City of London firms and institutions and is able to complement Cass faculty with guest faculty and senior level business practitioners, considered by their peers to be industry thought leaders.

Areas of focus for the programme include:

  • Risk management as a strategic competitive strength
  • An integrated approach to risk management
  • Fostering a culture and climate that openly communicates risk
  • A framework for rapidly responding to known risks and unraveling the complexities of the unknown
  • A focus on risk informed by global perspectives
  • Gaining a perspective on risk management and its implications for corporate governance

The programme will be led by Professor of Finance Stephen Thomas of the Cass Business School Faculty of Finance.
Professor Thomas joined Cass in February 2007, after being Professor of Financial Markets at Southampton University since 1996, and prior to that at the University of Wales, Swansea, from 1992. He is a member of the editorial board of  the Journal of Business Finance and Accounting and in a recent review was ranked 11th in Europe for finance research.

He is a director of Bear Stearns’ Global Alpha (hedge) fund, and since 1988 has been consulting editor of a range of
credit publications for FT Interactive Data. He is an examiner for the Investment Management Certificate of the Society of Investment Professionals, and author of the accompanying Official Training Manual.

this is an extremely well-pitched course and relevant to the sector”.

Will Jennings, Head European Risk Monitoring Unit,

Rabobank (2014 Programme attendee)

For more information or to enrol, please visit: www.cass.city.ac.uk/riskmanagementprogramme

PROGRAMME OUTLINE

Curriculum Themes:

  • A Holistic Approach to Managing Risk Amidst Global Uncertainty
  • Global Economic Perspective
  • Outlook for Financial Institutions
  • A Risk Management Framework for Tomorrow
  • Risk Strategy and Appetite
  • What Shareholders/Investors Expect from Banks
  • Key Regulatory Developments
  • Governance
  • Risk Processes and Methodologies
  • Optimising the Credit Process
  • Modern Credit Parameters/Credit Risk Modelling
  • Counterparty Risk
  • Actively Managing Credit Risk
  • Market Risk
  • Liquidity Risk
  • Operational Risk
  • Firm-wide Risk Management
  • Stress Testing
  • Risk Data and IT Systems
  • Risk Management Skills, Resources and Culture

AN INTENSIVE CURRICULUM: INTEGRATED AND PRACTICAL LEARNING

Varied and integrated teaching methods are used, including:

  • Project work
  • Presentations
  • Team-oriented learning
  • Lectures
  • Panel sessions
  • Case studies

THE BENEFITS OF ATTENDING THIS PROGRAMME

  • Meet and network with executive peers to gain a diverse and thus broader understanding of risk issues
  • Broaden your knowledge of leading-edge theory and practice to increase your ability to create and sustain a high level of performance
  • Take part in focused learning which will result in advanced proficiency, leading to strategic advantages
  • Interact with renowned faculty and thought leaders to improve your decision making
  • Strengthen your ability to steer projects to completion through understanding the issues impacting your institution

“Good, well organised programme that touches on topical subject matter. Great presenters. Very imp r e s s e d ”. Reshma Shah
Senior Risk Manager, BNY Mellon
(2014 Programme attendee)

WHO SHOULD ATTEND?

This programme is designed for participants who work in the financial sector in the UK, the EMEA Region or Asia and are senior risk practitioners or business-line executives on track for broader assignments within their organisation.

Candidates attending this programme must demonstrate significant leadership capabilities, subject matter expertise, and progress along a positive, long-term development and responsibility trajectory.

The programme is also considered suitable for independent non-executive directors of financial sector firms.

A UNIQUE PARTNERSHIP:

The RMA and Cass Business School

About RMA

Founded in 1914, The Risk Management Association is a not-for-profit, member-driven professional association whose sole purpose is to advance the use of sound risk principles in the financial services industry. RMA promotes an enterprise approach to risk management that focuses on credit risk, market risk, and operational risk.

Headquartered in Philadelphia, Pennsylvania, RMA has 2,500 institutional members that include banks of all sizes as well as nonbank financial institutions. They are represented in the Association by more than 16,000 risk management professionals who are chapter members in financial centres throughout North America, Europe, and Asia/Pacific.
www.rmahq.org

About Cass Business School

An integral part of City University London, Sir John Cass Business School is among the global elite of business schools that hold the gold standard of ‘triple-crown’ accreditation from the Association to Advance Collegiate Schools of Business (AACSB), the Association of MBAs (AMBA) and the European Quality Improvement System (EQUIS). Cass is consistently ranked amongst the best business schools and programmes in the world which, coupled with an established 40-year reputation for excellence in research and business education, enables Cass to attract some of the best academics, students and businesses worldwide into the exclusive Cass net work.

Cass enjoys unrivalled links to the City. The outstanding quality of the learning resources, academic faculty and its City location make Cass an intellectual powerhouse, firmly plugged into one of the world’s greatest business centres, the ideal place to access and exchange the latest ideas, expertise, business practice and technical know-how. We have ready access to the people shaping markets and leading new trends. To enrich our programmes with new perspectives and experiences we draw speakers and course leaders from this extensive net work of people at the top of their professions.

For delegates attending programmes, London is a choice location. As one of the world’s leading cities, its rich history and dynamic cosmopolitan culture generate an exciting mix of cultural and social opportunities. A major transport hub, London is highly accessible from anywhere in the world.
www.cass.city.ac.uk/executive-education

For more information or to enrol, please visit: www.cass.city.ac.uk/riskmanagementprogramme

LOCATION

Cass Business School
Executive Education
200 Aldersgate Street
London EC1A 4HD
United Kingdom

LOGISTICS

Programme cost: £5,500
The fee includes attendance, course materials, daily lunch and refreshments and a private dinner at a London restaurant.
As this is not a residential programme you will be required to arrange your own accommodation. Should you require any assistance in making your hotel arrangements, please contact Cass.

    • Monday 23rd February 2015: 10:00 to 18:00
      Opening session followed by welcome lunch, then in-class sessions and project work
    • Tuesday 24th February 2015: 09:00 to 18:00
      In-class sessions and project work
    • Wednesday 25th February 2015: 09:00 to 18:00
      In-class sessions and project work
    • Thursday 26th February 2015: 09:00 to 18:00
      In-class sessions and project work, followed by cocktails and dinner with a guest speaker
    • Friday 27th February 2015: 09:00 to 17:00
      In-class sessions and project work, followed by group presentations to a panel of experts

QUESTIONS?

In the United Kingdom

Joanne Paktsun, Client Relationship Coordinator, Cass Executive
Education, +44 (0) 207 040 8711, joanne.paktsun.1@city.ac.uk

Caitriona Conway, Business Development Director, Cass
Executive Education, +44 (0) 207 040 8269, caitriona.conway@city.ac.uk

Steven Shaw, Senior Regional Consultant, Europe, The Risk
Management Association, +44 (0) 1732 463875, sshaw@rmahq.org

In the United States

Stacy Germano, Associate Director, Enterprise Risk Management,
The Risk Management Association, +1-215-446-4089, sgermano@rmahq.org

Mark Zmiewski, Director, Enterprise Risk Management,
The Risk Management Association, +1-215-446-4085, mzmiewski@rmahq.org

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