Source: theHRDIRECTOR
Date: April 2006

"Our HC strategy provides our businesses with a deeper understanding of the links between effective people management and superior service and financial performance"

The group has 140,000 staff in 30 countries serving 30 million customers. Over the past three years it has developed an award winning Human Capital (HC) strategy that provides business leaders with a detailed understanding of how effective the group is at attracting, engaging and retaining the best people, and how its people strategy drives business performance. At the heart of this approach is the Group’s ‘Human Capital Toolkit’, a comprehensive suite of online resources that provide HR staff with desktop access to a range of diagnostic tools, benchmarking resources and employee research and measurement tools.

Greig Aitken, head of Employee Research and Measurement at RBS explains; “Our HC strategy provides our businesses with a deeper understanding of the links between effective people management and superior service and financial performance. Within our Human Capital Toolkit we have consistent measures and tools in place to diagnose issues across all our staff in some 30 countries – HR is in a proactive position as a result.”

The Group’s Toolkit provides consolidated information on the global employee base and is split into six core elements:
• Surveys – access to analysis tools, presentations and action planning support across the entire employee survey suite of the Group – this includes joiner, leaver, pulse and employee opinion surveys as well as acquisition surveys and management/leadership effectiveness surveys.
• Benchmarking – RBS has developed tailored benchmarking information for each business and function (e.g. IT, call centres and head office departments). Forty HC measures have been benchmarked against the company’s competitors in all their markets (e.g. insurance, US credit cards, UK retail banking etc).

• Research – this resource provides access to internal research across the Group on topics such as call centre performance, performance measures and organisational development. It also offers direct access to external research and employee research partners. HR staff can commission custom research across any HR topic from their desktop – and researchers in Washington and London are used to ensuring their questions are answered quickly – staff can also discuss the findings with the researcher.
• Measurement – HR staff can investigate the links to business performance themselves by first accessing key metrics derived from HR’s global data warehouse.
• Metrics can be delivered in seconds at a range of levels, from the whole Group down to individual cost centres and business units.
• Reporting – access to Human Capital reports on a variety of topics such as absence, staff turnover and diversity. This includes reports to the Group’s board, executives and senior HR staff, giving a deeper understanding of how key HR issues relate to business performance. Access to all external reports is also provided.
• Business Intelligence – a ‘one-stop-shop’ for business information relating to RBS’s competitors and links to RBS business information – aimed at keeping HR staff updated with business context and competitor analysis.

A key resource in the Group’s HC strategy is its annual survey of employee attitudes. Conducted in partnership with global employee research and consultancy firm ISR, the ‘feedback’ survey is delivered to the 140,000 staff individually. It is completed online and on paper (depending on business access) and is produced in seven languages. “Together with our survey consultants, ISR, we conduct this survey anonymously to get direct employee feedback and to compare our results to those of our peers,” explains Aitken.

"Key to the success in this area has been cross-business executive support"

“The results are compared to ISR’s financial service sector benchmarks, which tell us how we are performing against our competitors and provides managers with a powerful tool on which to base decisions”. At 86%, RBS’s response rate for its employee survey is 20% higher than the market average.

“ISR have been our survey partners for the last six years, and have directly supported our Human Capital strategy. This partnership bears fruit on a number of levels including thought leadership on survey strategy, acquisition surveys and high impact analysis of our employee’s opinion data. They also provide assurance in relation to survey anonymity – a key reason why our people feel comfortable completing our annual survey
honestly,” explains Aitken.

The last employee survey, conducted in September 2005, showed that the company outperformed their global competitors in all of the fourteen measured categories – a significant and unique feat. Dr Stephen Young, at ISR explains “This marks the fifth year of improvement for RBS and there is good reason to believe these results are sustainable for the future.”
 
Key to the success in this area has been cross-business executive support. A Human Capital board has been established to manage the Group’s work in this area. Chaired by Greig Aitken, it consists of business executives, HR directors and the Group’s deputy chief economist. Under the governance of the Group’s HR Leadership team, this board is responsible for prioritising HC initiatives based on business impact.
Aitken believes that the strong support from Neil Roden (RBS’s Group director, HR) and his leadership team has been crucial to RBS in reaching such a strong position. “Neil and his leadership team have been instrumental in setting the Human Capital agenda; they are key to ensuring our approach continues to be embedded in the business and also continues to receive business sponsorship”.

RBS publish Human Capital measures in their annual accounts and in their corporate responsibility report. This includes a review of performance, workforce demographics and the results from their global employee survey, together with how the company is positioned against its peers in each category. The detail reported externally is significantly more than most organisations. Aitken explains; “We believe that by reporting how our people strategy drives business performance, we differentiate RBS Group as a great company to work for, invest in and bank with. Sharing our approach to developing a highly rewarding and productive workplace is a key part of this approach”. And with recently announced profits of £8 billion in 2005, RBS is clearly getting its approach right.