I started off my career in banking, and I chose to join The Royal Bank of Scotland, rather than go to University. I did all my professional banking exams and spent eight or nine years in mainstream banking. In those days, the banks managed your career for you, quite literally. I received a letter which basically said: “You’ll be starting in two weeks’ time and you’ll be in HR for two years”. Frankly, human resources was the last department I wanted to go into, but there I was, in HR trying to make sense of my position. What really surprised me was that, quite quickly, I felt at home in banking and people management, so, within a couple of years, I applied for a vacancy as Executive Assistant to the Group HR director at RBS. When I now mentor people I always say it was one of the most valuable jobs I’ve ever done, because it gave me an insight into how large organisations operate at the top; how decisions are made and how important influence is at an executive level. It was great exposure – in a safe way -to all that happens in an organisation, and I spent two and a half years doing that and it was of huge benefit.

Of course, this was pre-internet banking so the big difference from now was customers did all their banking in branches and there was no real customer segmentation. Then in 1991, the bank was divided into three divisions: Retail, Corporate & Institutional, and Operations, making us one of the first to segment our operations in this way. I moved to London in 1992 and spent five years working with the Corporate and Institutional Banking division from start-up, and it was five great years that gave me exposure to the City of London. This was very different by comparison to retail banking, and HR within this division had to be much more commercially focused. I dealt with recruitment, development and performance management and those five years I spent in that role were one of the key milestones in my career.

One thing is, the corporate banking division within The Royal Bank wasn’t an investment bank, it didn’t do propriety trading, it traded in the assets of its customers, so the risks weren’t as great as in an investment bank. The type of people you attracted into the business were different in profile to what you would expect to see in an investment bank, and the culture in the organisation was very much a collaborative one. It was much more about team work, the people were not singularly focused on huge reward, and it wasn’t a ‘star chamber’ type of environment. It was a collaborative culture with a real sense of building something that was very much focused on customers and their needs.

So one of the challenges was to find a new approach to client relationship management. This was one of the biggest programmes at the time in The Royal Bank. We rolled it out from the Treasury through to corporate banking so we could see any client and customer requirements. This was revolutionary in the way we thought about it. From an HR point of view, we began to use commercial client language without jargon. Management had no time for any initiatives or ideas they felt weren’t going to add to the bottom line, so we had to influence and position our proposals in a commercial way, and focus on building long?term customer relationships.

I went to Scottish Power at the beginning of 2000 after spending 16 years with one organisation. I questioned whether I wanted to stay in the same place forever and ultimately it came down to my aspirations of achieving a group HR director role. I also wanted international experience, working in a different culture and sector. The opportunity at Scottish Power came up to look after the top 250 people across the UK and US covering performance, recruitment, development and reward. It was a great opportunity and I spent a lot of time in America which gave me a new insight into HR in a very different culture.

You have to immediately accept and adapt to the fact that there are core differences, organisationally and culturally. I spent a lot of time in the West coast of America, and I found a culture that was easy to understand. I felt confident enough to get stuck in and start developing HR strategies that the organisation needed, which were built around operating internationally. It goes without saying that utilities are massively commercial organisations ? a necessity for them to survive ? and so from an HR point of view there are lots of different challenges dealing with engineers, to dealing with office and banking staff. Engineers are pragmatic, thrive on autonomy and have a mind?set which is very practical, so the challenge was to work the core problem and how things could be improved. I really looked at simplifying the HR agenda, keeping things clear and straightforward and they responded to that. When you’re working internationally in this type of environment, you can’t manage without clear and qualitative communication.

I would say one of the things was the approach to talent management. We did a lot of work with the Wharton Business School in Philadelphia, where I spent six years as a non?executive director. The work we did at Scottish Power was viewed as very innovative, along with the whole people development agenda. If you look at Scottish Power today, their Chief Executive is a product of that talent management strategy. There was also a lot of work on rapid resourcing internationally, moving people across the globe on assignments, developing them, whilst also working on a sustainable and manageable balance of recruiting people externally, as well as internal resourcing and development.

We also changed the performance management system which was quite a challenge, particularly because we allocated 20 percent of bonuses at senior level to behaviours. We introduced the “score card” methodology, and at an individual level, each senior manager had a performance agreement that was attached to a set of objectives, including the ‘what’ and ‘how’, plus a development plan and this approach drove a lot of change. We successfully rolled out this approach across the entire top 250 people within the organisation, covering the US and UK.

It’s quite interesting because I have a slightly different view of this compared to most of my peers. I don’t “compartmentalise” people into leadership talent and technical talent. I view leadership as a spectrum from technical ability to leadership and every role has an element of technical and leadership capability. The question is where on that spectrum an individual sits. A Chief Executive of an organisation is a great example, where your technical talent is taken as a given, and in my experience, most CEOs are successful because of great leadership capabilities. At Scottish Power we had a Chief Engineer, and in Standard Life we have a Group Risk Officer and even though those roles are technical, they also make a big impact in leadership terms, both internally and externally. So in my eyes, every role is made up of technical and leadership and you shouldn’t force people into a leadership or technical stream. I agree you need to be careful not to assume that, if somebody is technically capable, that means they can lead, but it also means that you should give people the freedom and flexibility to move roles and develop.

A good example at Standard Life is our Group Head of Strategy, who recently took up a customer service leadership role. Up until then, they had only managed a few people, but the move was linked with their development, and that person is doing very well. So the lesson is, don’t label people and never underestimate a line managers’ assessment. One thing we did at Scottish Power was to put the top 100 through an external assessment process. Once this was complete, we looked back at the correlation and saw there was little difference between external and internal assessment ? in most cases, there was strong alignment across both assessment techniques. So you need to look at it in a holistic way, and really understand people and think about future potential and performance. Organisations are made up of a lot of people, some come up the technical/engineer line, and are naturally gifted leaders, but others are plainly not. So it is a key part of HR to identify those who are and, importantly, who want to be future leaders, and give them every opportunity and encouragement to progress upwards, for the mutual good.

Yes, but it is also very telling about what’s been done in good times that turn out to be important factors when bad times hit, i.e. in boom times, were you there admiring your handy work and enjoying big rewards, or were your reinforcing the foundations and structure of the business to withstand any eventuality? It goes without saying that the financial sector has had its ups and downs, but a lot of other industries have too and it has boiled down to the calibre of people as to how businesses have faired. I’ve often heard and read that the reason the recession has hit so hard is that leaders may not have experienced a recession before. I’m not sure that is a plausible excuse. HR is about the day to day, but increasingly, along the way has been more about strategy and planning. There’s not much training and development you can give people to manage through a trough, you can’t replicate that in the class room. But it is all about who you have placed in those leadership roles in the first place, and the support network you have provided, so the onus and responsibility is fundamentally on HR.

I’ve always thought of HR as a profession and a service and internal support function and I think in the past few years, HR has had the opportunity to use its influence to really inform strategy and plans. I’ve seen HR, when and where it has been done with confidence, presenting a strong enough business case for its agenda and gaining support from the wider business to carry things through. This is crucial where a lot of change is needed. HR needs to step up to the plate and make organisations more effective and efficient. HR needs to be courageous and believe in its convictions.

Yes, HR functions do lack focus and I think they try and do too much, I think fundamentally, HR has to focus on three areas: Firstly, it must ensure it influences and delivers to the businesses agenda in an effective and commercial way. Secondly, HR needs to step into that space of being the conscience of the company, the custodian of the organisation’s culture, bringing forward ideas and strategies to drive the business and, at the same time, it must have a seat at the top table and not be afraid to have those difficult conversations. And finally, governance and risk, which has to a degree been lost. I often say HR is a risk function, it just happens to manage a different angle of risk, and we need to recognise our responsibility. One of the main problems is HR isn’t speaking up, it needs to recognise it has a relationship with everyone and they, for their part need to use it.

The attraction to Standard Life was twofold; firstly I’ve always chosen carefully who I work for, I had already worked with Chief Executive, David Nish, for five years at Scottish Power, and got to know him well. He asked me to think about coming onboard to look at the transformation programme around the organisation, its culture and leadership, how it delivered to customers, managed people and talent and so on. Secondly, Standard Life is well respected in the financial sector and the HR function has always been traditional in its approach. It was a good time to take it forward and think ahead.

I’ve done it both ways in so much as I’ve worked with what’s already there and also restructured to shake up the top team. It’s tempting to walk into a new company and restructure and that’s the way the text book says to do it. At AEGON, where I was UK HR Director, prior to Standard Life, I walked in and said: “I don’t want to make any changes for six months or so, to give people opportunities to show me what they can do. At the end of that time, I started to make changes that led to some people leaving the organisation and some people joining. When I joined Standard Life, the Group HR Director left and so, in addition to Director of Transformation, I also took that role on. On this occasion I had to quickly make changes. I restructured quickly, meaning some people left and I needed to bring in people to fill gaps. So Standard Life was a lot of quick decisions with dramatic and swift restructuring. The bottom line is, you’re only as good as the team that works with you, it is down to how the team works together, complements and supports each other.

The transformation program was focused on customer and talent, performance management and organisation design. What’s interesting is, I was leading the program and had a strong HR focus, and normally, HR wouldn’t be leading such a program. The first place you start is organisational design, as there is no point in doing anything until it is right. So we spent the first six months really working on the structure of the whole organisation, creating four business units with four Chief Executives, with David Nish as Group Chief Executive, Jackie Hunt as Group CFO and myself looking after people. It’s quite a tight group, each with its own business executive committee, and with each business having a score card with a common framework. Then we moved onto talent and reward, as well as a whole refresh of the brand, so the customer side had a whole new look and feel as well.

On the face of it, the sector has weathered the last year quite well, but there are a number of factors that are coming up in the next few years such as the retail distribution review (RDR), auto-enrolment and Solvency 2. That means a lot of change for us and how we do business. For HR, it’s about resourcing and developing skills and capabilities. Working with intermediaries will remain number one for us in terms of our main distribution channel, but the corporate workplace is increasingly important. We’re also seeing a new generation of customers coming through, who are much more confident about dealing directly with us and so we are taking a long, hard look at our skills and capabilities.

The great thing about Standard Life is the brand, it is trusted, which is great. But at the end of the day, a new generation may not think it sounds exciting, so we need to think about the brand and extend it to that space. The corporate space is a growing market for us and gives us a great opportunity in the workplace. We are rolling out our propositions to big clients and very much see it as a great opportunity for employers to use our market leading technology. We also have an investment management business, Standard Life Investments, which is a tremendous asset and allows us to provide investment expertise and capability. So from an HR point of view, skills and capabilities are very high on the agenda.

You have to look at reward from a number of perspectives. It has had bad press and, in many cases, this is rightly so. But the question is, what is a person’s worth, and what do they really bring to the business and its success? One thing’s for sure, no organisation will ever solve the issue and neither will more Government legislation. You need to attract the top talent and that is a challenge, whatever the state of the economy. But I think there are a number of positive things such as, performance management, which historically has been very poor at executive level. People have been allowed to leave organisations with lucrative rewards for failure, and I believe that is fundamentally wrong. I think HR directors have to be much more mindful of unintentional consequences and appropriateness of behaviour and really scrutinise what is the underlying culture of a business. You have to be brave and challenge where there is wrongdoing, for the greater good.

As I said, I believe reward for failure is wrong and it is up to the organisation to understand a person’s worth, and what they really bring to the success of the business ? whatever that business is. Remuneration should encourage behaviours and deliver results that reflect the best interests of shareholders and other stakeholders. At all levels it needs to be competitive and reflect an individual’s performance and their value in the market.

The transformation program itself became business as usual in the second half of last year, after being in place for over 18 months. We’ve achieved what we set out to do, the program was a small group of people working very much to my model, engaging with the businesses, and we ended up embedding the program into business as usual. I think the HR function still has huge potential that hasn’t been realised yet. I believe the HR team is a combination of people with the right behaviours and skills, and we’re rapidly changing our approach to technology such as Oracle HCM and thinking through whether we can use the new fusion technology and be one of the first companies to do that.

Beyond the HR teams we’re putting a lot of time into developing people. HR is really taking the lead in encouraging the business to do this, up? scaling the function and focusing on people’s behaviours. One challenge is the diversity of people in the function, from Reward through to Learning and Development, and everything in between. The challenge for the HR director is to ensure these functions operate effectively together. I spend a lot of time bringing it together so we end up with an integrated model and we think of ourselves as a business, as a whole. My view is, as a customer of Standard Life, you would expect a seamless, integrated experience and, increasingly, a digital experience. You shouldn’t think any different from an HR point of view. We’re 18 months into that journey, phase 2 will end this year and we probably have another 18 months to go.

Its worth is always held up to scrutiny. HR, as a profession, fascinates me. I always say to HR graduates that they have an integrally important purpose in the business. I’ve never apologised for my function or my role, I think the HR profession is growing in confidence and it is becoming even more important too in a variety of ways. HR is the conscience of the company so it needs to be an equal. It’s an easy thing to say but hard to achieve, but we need to move to a point where the balance in the organisation is right and it holds people to account for their actions and behaviours. Secondly, Group HR Directors need to have the utmost confidence of the CEO to ensure the organisation works effectively ? this is now more important than ever. I spend a lot of time trying to make this work, it’s about giving support and feedback. Lastly, the HR director should be able to merge in with the business, speak the language and truly understand the business. That’s the benchmark we need to set.

What I found moving into HR was, I had a real passion to try and develop and encourage people to be the best they can be, while creating functions that also allow people to fulfil their potential. So I think I probably always looked at HR differently. You don’t hear me talk a lot about policy and process ? not because they aren’t important, but it’s the foundation that should be built on. Ultimately, the HR role is there to make an organisation perform better, that makes it a fundamental part of the engine.