Margaret Kett and Chris Goward: Business transformation, an essential requirement of the corporate landscape

HR ReviewOne of the biggest challenges companies face in their drive to capitalise on market opportunities through change is the issue of diversity, a subject widely covered in the media.

When Fiona Woolf, CBE, was Lord Mayor of the City of London (2013-2014), only the second time in 800 years that a woman has held this office, the key theme of her Mayoralty was ‘Harnessing Talent: The Power of Diversity’.

Research undertaken by Lady Woolf and led by Charlotte Sweeney of Charlotte Sweeney Associates, highlighted that 87 percent of respondents claimed that those at the top of their organisation took diversity and inclusion seriously, while 84 percent said that the work undertaken in diversity and inclusion had not affected them personally. The implication might be that whilst senior executives are serious in their intent to address transformational change relating to diversity, they are failing to do it in a way that the entire organisation either understands or can relate to.

One company that has achieved significant transformational change is beverage alcohol giant Diageo. Employing almost 30,000 people worldwide, the issue of talent management and development was changed from an HR issue to a fundamental strategic business issue. This provided HR with the ability to access substantial investment and executive sponsorship to ensure success.

At Diageo, talent management is one of the six key performance drivers that company executives focus on to improve operations in each of its 21 geographic markets. Talented employees, irrespective of gender, are systematically identified, assessed, developed and retained to meet current and future business needs and objectives. The organisation is a champion of diversity, strongly believing that it provides sustainable competitive advantage.

With the advent of the digital era, Nicola Mendelsohn’s appointment to the Diageo board was not a box-ticking exercise to satisfy politically-motivated gender quotas for the boardroom. As Vice President, EMEA of Facebook, Ms Mendelsohn has experience at the forefront of digital marketing and communications, skills that Diageo management believes will be of great value to the company.

In keeping with the company’s human capital objectives of having at least 30 percent of senior management positions held by females, women hold key roles on the Executive Committee. Currently, 40 percent of its Executive Committee and Board members are women. They include Chief Marketing Officer Syl Saller who joined the company in 1999 and worked her way up through the marketing ranks, Deirdre Mahlan who holds the position of Chief Financial Officer (in addition to a seat on the board), Strategy Director Anna Manz, the Corporate Relations Director is Charlotte Lambkin, HR is headed by Leanne Wood and the General Counsel is Siobhan Moriarty who joined the company in 1997 holding various legal positions before her promotion to the top legal position.

Diageo’s position in relation to gender equality is driven by the belief that winners in global business will be those with the most diverse leadership teams.

In Africa, where the role of women is changing rapidly and many are gaining greater status and influence in societies, Diageo created and marketed a drink specifically with women in mind.  Known as Snapp, a sparkling alcoholic apple flavoured beverage providing a more stylish and sophisticated alternative to beer, the product became the most successful launch of a new brand for Diageo, with more than £10 million in sales in its first year.

In McKinsey’s “Women Matter 2012: Making the Breakthrough” report, it was stated that the best performing companies are those that succeed in four ways:

  • Having top management commitment, making it visible, and supporting gender diversity as a way of life, not just a series of initiatives
  • Addressing mind sets of men and women to better support diversity and making the business case for gender diversity
  • Monitoring women’s representation carefully
  • Driving their gender diversity programmes.

Business transformation requires leadership development approaches that are designed to help women develop critical leadership skills and help them identify and exploit their strengths, increase their confidence and become comfortable in taking risks. Women need to create their own social capital by developing networks of support, seeking sponsors within their companies, securing mentors, promoting themselves and communicating the value that they bring to the organisation.

You may also like