I recently met with Alan Walters, VP Human Resources, UK & Ireland to hear more about their ongoing transformation and growth.
Unilever is one of the world's leading suppliers of FMCG. Two billion times a day somebody, somewhere in the world, buys a Unilever brand. The company has 167,000 employees globally and an exciting growth agenda. Unilever's origins in the UK date back to the 1880s when William Hesketh Lever launched Sunlight, the world's first branded and packaged soap. Today, its portfolio of products includes household names including Persil, Dove, Magnum, Flora, Marmite and Lynx. Around 7,000 people work for Unilever in the UK & Ireland, the majority of whom are in sales and marketing positions.
Unilever's sustainable living plan
Unilever has an ambitious aim to double the size of the company while reducing the overall impact on the environment. What has driven this?
This is a very exciting new agenda for us. In November last year, we set out in the Unilever ‘sustainable living plan’ a wide ranging set of environmental and social targets which we have committed to achieving by 2020. The vision is driven by what our CEO Paul Polman would call 'enlightened self interest', since while being a responsible business is the right thing to do for the planet, there’s also a clear and persuasive business case for integrating sustainability into our brands. I personally find this incredibly motivating.
How are you going about reducing environmental impact?
One of the most important points in the Unilever ‘sustainable living plan’ is that we recognise the need to address the environmental impact of our products throughout their entire lifecycle. For a consumer goods manufacturer like us, the majority of this actually takes place in people’s homes. That might be when they use warm water to wash their hair with our Dove Shampoo, when they boil the kettle for a cup of PG Tips, or when they heat up a Bertolli pasta sauce. So we are focusing on how we can use our marketing expertise to find ways of changing deep seated behaviours, perhaps in these cases by educating people to reduce their time in the shower, only boiling the amount of water they need, or putting a lid on their saucepan so their sauce heats through more quickly.
That said, we are also fully committed to continuing our efforts to reduce the footprint of our brands before they arrive in our consumers’ homes. For example, we’ve committed to sustainably source all of our tea by 2020 which, when you consider that we buy 12% of the world’s supply of black tea, is going to have a major positive impact.
Performance culture - reward
The annual report is clear about the move to a performance culture. What has changed?
We define success as ‘consistently outperforming the competition’ and believe that people want to be part of a successful, competitive business where they are well rewarded for making a difference. So we’ve made some changes to our reward structure to give managers the tools to better reward individuals who deliver consistently the goals that the business sets them.
How much have the changes in remuneration played a part in the culture change?
It is only our first year of the new approach so it is probably too soon to say, but the early signs look very promising. I think employees like the clarity and transparency around the basic message that if they perform well, they’ll get recognised for it.
How do you measure employee engagement at Unilever?
Every two years we have a global employee survey which goes to every employee at the same time. This is managed by Kenexa. We then have a six monthly ‘pulse check’ which the management population are asked to respond to. We find that one of the key indicators of employee engagement is how many survey forms are returned and this year’s results, which saw an eight per cent increase, have been very pleasing.
Unilever's agenda - innovation
What else is high on the agenda currently?
We have recently acquired Sara Lee’s personal care business, which will bolster our personal care portfolio with exciting brands such as Radox and Brylcreem. We are also hoping to receive regulatory clearance for our intended purchase of Alberto Culver, which would also bring shampoos such as TRESemme and Simple into the business too.
What are the barriers to success for Unilever?
The external environment is our biggest challenge. In the UK the retail environment is tough with higher than ever promotional activity and fluctuating commodity prices. However, we believe our strategy is the right one, and the fact that we’ve grown the UK business for the past 13 quarters is testament to that.
The strategy also talks about innovations that are bigger, better and faster, can you share any local examples of this?
The Knorr Stock Pot has had a massive impact not only in the UK, but in dozens of other markets too. It’s a product which demonstrates what can be achieved when you combine great innovation, fantastic consumer relevant marketing, and superb in-store execution. The model of rolling out one great idea to multiple markets is one which we also apply to our HR processes. If something works well, we look to roll it out everywhere, like our global performance management process.
Diversity - the business case
Diversity continues to be a hot topic. What are you doing at Unilever to drive diversity?
We have taken the business decision to focus first on gender diversity as we want to focus on one thing and get it right. There is an indisputable business case to have a diverse workforce. The majority of our products are bought by women, including products used by men, so it's important that our talent base reflect this. The key area we need to focus on is the diversity within our management roles, where the ratio of men to women isn’t what we’d like it to be. Among the measures we’ve put in place to meet the diversity goals we’ve set the business are mentoring programmes and improved flexible working arrangements. We’ve also set up a business network to discuss how to overcome some of the challenges women face, such as balancing their work life with family commitments.
What is your view on the recent Lord Davies report recommending that FTSE 100 businesses should aim for 25% of female board representation by 2015?
My personal view is that target setting in this way is dangerous. People should always be recruited based on them being the best person to do the job.
Winning with people
How do you demonstrate the return on investment in HR to your executive colleagues?
The return on investment comes from the performance culture which we create, and our ability to retain and attract some of the very best talent in the UK. It’s what we call “winning with people”.
How would your board colleagues describe you?
They would say I am very competitive, I don’t like losing anything. I am passionate about what I do and am fortunate to get the opportunity to work on what I enjoy at Unilever. I also say what I think, I am authentic.
What do you look for when recruiting for your own team?
People who have a track record of making a positive difference, and who share the same values of honesty, integrity and openness.
What advice would you give to someone starting their career?
Do what you enjoy, and never shy away from opportunities that will stretch you out of your comfort zone.
What achievements are you particularly proud of?
Apart from my kids?! I am very proud of helping Unilever UK’s transformation into a winning, agile and competitive business. I also feel great pride when talented people who we’ve nurtured rise successfully up through the business.
What is your biggest learning to date?
Don’t hesitate. If you know what is needed get on and do it. I have never ever regretted doing something too quickly. I have only ever regretted taking too long.
Marmite: love it or hate it?