O2 leads the way to a new era in employee engagement

Written by
Changeboard Team

25 Aug 2010

25 Aug 2010 • by Changeboard Team

Reaching beyond mobile

O2’s brand strategy is progressing at a pace, which has prompted the need for an entirely new approach to employee engagement.

We have been in the business of providing mobile services for eight years now. Following our launch in 2001, we quickly emerged as the leader in the mobile phone market.  Today, we boast more than 21.6m customers in the UK. We also have something which is the envy of the industry – an admired and respected brand.

But these are challenging times. Aside from a turbulent economic environment, the mobile service provider market faces its toughest Challenge yet. After a period of rapid growth, it has matured and is on the verge of saturation. In this increasingly crowded and evolving space, competitive advantage has become more important than ever before.

At O2 we’re on a never-ending quest to develop ever-more innovative ways of turning our customers into fans, that way, they stay with us. We’ve already got one of the lowest churn rates in the industry, thanks in large part to our unwavering focus on the customer experience. But we’re restless in our search for the next added-value service we can bring to our existing customers.

This has led us to take the O2 brand beyond mobile and we’re exploring areas where we can enhance customers’ lives by delivering them essential services that fit with their own lifestyles. Last year, we expanded into the financial services market with the launch of O2 Money and we’ve also recently launched O2 Insurance. 

We couldn’t drive this change without a hugely strong team behind it. At O2 we have a unique culture that drives growth and our people are helping us re-define what it means to be a service brand in the 21st Century.

Change you can believe in

As a result of this unique and wide-ranging business reorganisation, virtually all our employees were affected by some form of change last year. Some took on wider, more challenging roles; others joined newly created teams; some of our people chose voluntarily to leave. Added to this, we had an ambitious office-move as we relocated to a state-of-the-art new headquarters in Slough, which would dramatically cut our carbon footprint.

To help employees manage this complex period of change, and ensure they felt supported and motivated, we knew we needed to do things differently. Formulaic employee attitude surveys that ask one dimensional questions just wouldnt have worked. Findings yielded from such surveys are rarely acted upon and are simply used as place markers rather than guidance for change. This wasnt good enough and so we decided to develop and build on our existing metrics platform to take into account the business strategy and changing business context.

We wanted to understand better the effect of change on our people so that we could minimise the anticipated negative impact. We also wanted to capture their insight so that we could use it to make better informed decisions, plans and interventions.

We wanted to do three key things:

  • Understand the effect of change on our people generally, but with a real focus on those who were directly impacted.
  • Understand the effect of change on our line managers so we could support them appropriately. 
  • Understand key drivers of change, for example, their confidence to deliver change and their readiness to tackle it.

Implementation of the change process

In June 2009, we asked our existing employee engagement measurement provider, eePulse to work with us on how we could best manage and measure this change.

Telefonica, O2s parent company, runs an annual employee engagement survey called Reflect, but the questions are set at a global level and we quickly realised that this alone wasnt going to go far enough to support our UK staff through such a dynamic period.


Working with eePulse, the UK HR team developed an Interim Reflect Survey. While this in itself might not seem like a very groundbreaking event, it Challenged a number of key assumptions we had made.

One of these is that employees dislike change. Many models are built with this assumption in mind, so we developed a process for understanding the degree of change employees were experiencing and how movement through this change affected their levels of engagement.
We added two new questions which asked employees:

 to rate the degree of change they were personally experiencing
 and that their directorate (department) was experiencing


Initial findings were discussed with senior leaders, HR teams and line managers. The real-time insight gained was invaluable and led to us to redesign the question-set for our annual Reflect survey for O2 UK. Managers wanted to receive and use the data in real time to enable them to guide their teams through the changes that were happening.

Simultaneously, the team developed two specific measurement and feedback mechanisms:

A leaders and managers survey intended to assess their confidence in leading change and their readiness to do so. This intervention allowed us to monitor whether change was being led, received and implemented.

A tool called Survey in a Box that provided individual teams with an agile and flexible measurement tool that they could adapt and deploy quickly. We based its content on a simple model:

  • The core drivers of successful change e.g. confidence, understanding, fairness and direction
  • The O2 UK employee journey work that had previously been designed to enable O2 UK to manage change effectively. Using the 8 defined and potential employee change journeys, we were able to add question modules to the tool to find out how people were feeling throughout these change journeys.

It allowed staff to tell us whether we were being true to our 'People Principles' and we gave them the opportunity to provide verbatim feedback for the first time, something that proved immensely powerful for both employees and project teams. The process grew to be more than a change tool; it became an effective and positive intervention in its own right giving people a vehicle to provide their feedback in times of change.

The Results

The new approach really allowed us to get under the skin of employees and their relationship with the business. Indeed, the process of quickly mobilising bespoke surveys to ask people how they were feeling at particularly difficult periods has had a profound effect in itself.

Contrary to conventional change management theory, we discovered that our employees were most engaged (they had the highest employee engagement scores) when they were exposed to higher, rather than lower, levels of change. For example, we learned that a degree of change can be a positive experience for our employees and that our people were thriving rather than struggling during our transformation programme.

In addition, our people were more engaged when others around them were experiencing change. It was only when people were among a minority affected by change that we saw engagement levels decrease.

The ability to provide open ended dialogue in our 'Survey in a Box' also suggested that the majority of our people were excited about the change, were anticipating development opportunities as a result and had a positive outlook for the future.

Survey in a Box allowed us to use real-time insight to plan more effectively ahead of big reorganisations, while ensuring we continued to deliver a great employee experience. Armed with this intelligence, we were able to accurately predict, in advance, how people will feel in advance of any business transformation programme and use this insight to hone our HR strategy and, most importantly, our wider business strategy. We now have a reliable, effective method of handling organisational change, an essential element that will help enable O2 continue to innovate and evolve as a business.

The numbers on organisational change management

New real-time survey

McKinsey research shows that 70% of organisational change management plans fail.

  • But during a period of sustained change, we retained 89% of our high performers (those with APR scores of 1 or 2) and engagement levels met expectations.
  • Not only did the business achieve its annual target for engagement scores, but the engagement levels among the groups experiencing the most significant levels of change were 10-20 points higher than the industry average.
  • Supported 12 change programmes to date.
  • With a total number of 32 separate surveys.