Competencies Calling :
Starting at the Top with the Avon Board
At last year’s Competencies Tools
and Applications conference staged by Linkage in London, and sponsored
by Competency, Stephen Martin of Kimball Consulting, and Bronwen
Curtis, Executive Vice President for HR at Avon Cosmetics, presented on
the development of competencies and their strategic applications with the
Avon board. The session was packed, and many reacted to the presentation
with some envy ~ few businesses get the kind of senior sponsorship for
HRD initiatives that clearly featured at Avon. And as the presentation
unfolded, the depth, range and impact of the initiative impressed many
more.
Competency asked Stephen
Martin to write-up the main features of the Avon programme.
While most sign-up to the idea that HRD initiatives
are most effective when they start at the top, in reality only a minority
are given that opportunity. But at Avon Cosmetics, the Board saw for themselves
that they needed to change the way they identified and developed talent
for the most senior roles in the business ~ and they were clear that the
solutions started with understanding what it took to succeed at board level,
and how that was different from even the most senior levels just below
them.
Avon is a large, complex business. With 150,000
Representatives in the UK, it boasts that "There are more Avon ladies than
soldiers in the British Army", and it dominates the direct-sales sector
for it’s core business – cosmetics, fragrances and toiletries (the CFT
market) by a considerable margin. In direct sales in this sector, it really
has no substantial competitor. With world-wide sales in excess of US$5
billion, and 2 million representatives across 131 countries, Avon Products
Inc. is a significant business.
Outside of North America, the UK is one of the
most significant earners for the corporation, the more noteworthy for the
fact that the UK is a very mature and sophisticated market, with a wide
range of choice for the customer. Yet UK sales continue to grow year-on-year,
and with a substantial proportion of the product manufacturing and distribution
for Europe centred in the UK, the Head Office in Northampton is in effect
the Head Office for Europe.
Up until recently, however, and despite the complexities
and scale of the business, development and succession to senior levels
relied very much on a ‘traditional’ methodology ~ the most technically
talented tended to rise to the top within their business function, and
were accordingly ‘noticed’. As needs at board level arose, this population
were the first resource, supplemented by external candidates when necessary.
Selection, either internally or externally, followed a well-worn pattern
based on classic interviewing processes coupled with internal intelligence
where available.
While the process itself felt comfortable enough,
the results didn’t. Over the years, too many successful candidates ultimately
could not offer the critical skills and capabilities which board-level
roles seemed to demand, and just as bad ~ the process was not trusted or
understood by the senior internal population. Consequently, Avon was losing
many of its most talented people just at the point when they might be ready
for an executive role. The status quo was no longer acceptable ~ and unusually
for a board, the Avon executive team saw the problem and the solution starting
with themselves.
Issues and Questions
In the presentation at last year’s conference,
Bronwen Curtis used these slides first :
What Bronwen was highlighting here was that, at
around three years ago, the senior management team had recognised through
the existing HR processes that the business was not developing individuals
to their potential, that those apparently capable of making it to the highest
levels were not making it, or failed when they did, and that nobody really
knew why.
It was also clear by that stage that the strategy
of the organisation would require more from less people, in fewer organisational
levels, with greater freedom and willingness to act, and with greater accountability
for their actions. Attempts at internal promotion to what Bob Garratt1
calls ‘The thinking brain of the organisation’ – the board – had been too
frequently unsuccessful, and yet it was clear that the external market
was full of risks too, particularly when you are not sure what you are
looking for.
The senior HR manager with accountability for
development under Bronwen Curtis’s re-focused HR function ~ Sherrell Pape
~ was the first to identify a competencies-based approach as having the
potential to address these issues. Sherrell recognised that carrying on
with the same approaches and expecting a different result was not going
to achieve what was needed, and she recognised too that the board was ready
for a more radical programme; it was a good opportunity to enrol their
commitment.
While significant initiatives around performance
management, compensation, training and recruitment were taking place throughout
the organisation, the sponsors of those HRM-agenda programmes became increasingly
convinced that this ‘new’ competencies approach was more systematic, more
developmental in nature, and more closely aligned to the strategic needs
of the business than anything they had seen out of HR before.
As consultants we were asked to help design and
deliver tools that provided solutions rather than sold concepts, and which
allowed for the development of internal capability to provide them over
time through the transference of expertise. The board wanted to understand,
identify and measure those factors that differentiated superior performance
at board level, and ultimately at all other levels, and to apply that learning
quickly to internal development, and to internal promotion and external
recruitment.
The Project Structure
The project plan was built closely in line with
the classic design of professional competency-analysis processes, with
one important difference – from the outset the focus was on applications.
It was vital for the credibility of this ‘new HR technology’ and for the
achievement of the strategic HR objectives that there were, in the language
of Kotter, some ‘short-term wins’. We were definitely in the ‘organisational
transformation’ business, and Kotter’s2 famed eight steps were
a subliminal road map for the whole process.
The key stages of the process were :
1. Primary research and
analysis ~ including strategic and ‘Behavioural Event’ interviews,
and a thorough document search, looking at strategic plans and performance
commitments and measures for the UK business.
2. Creating a ‘Competencies
Framework’ ~ identifying from the research a wide range of potential
competency categories, transcribing and meticulously coding the behavioural
data arising from the interviews, slotting the data and identifying the
data-emergent categories, and creating a source-referenced numeric and
behavioural data-base.
3. Identifying and defining
Competencies ~ consolidating the ‘Framework’ driven by the data-patterns
(distribution and cross-relationships, critical context, critical outcomes),
developing definitions from the data-content of the consolidated categories,
and focusing and identifying the differentiating factors by work-level
and performance.
4. Organising the behavioural
data ~ addressing the demands of the challenging applications this
work was intended to support, through isolating and defining individual
levels of sophistication within the behavioural data, for each competency.
5. Feedback and presentation
to the board ~ including taking them through the methodology after
the interview stage, looking at the results in some detail, and committing
to specific, early actions
The first stage was initiated with focused strategic
discussions with each individual Board member, their European functional
peers, the President of the UK business, and a cross-section of global
senior executives who had a clear stake in the success and output of the
UK board, and had a role in defining the expectations of them. The idea
was to get a more rounded, and longer-term view of the strategic influences
and context within which the UK Board operated, and through the subsequent
and major part of the research, to ascertain through ‘Behavioural Event
Interviews’ with both the UK and non-UK executives, what the key differentiating
competencies were, as expressed in actual behaviour, for success at this
level.
From the Initial Framework to the Final
Model
From the strategic and documentary input, an initial
broad framework was built. The categories at this stage captured a wide
range of factors, which from what was known at that stage, we anticipated
would be sufficient for the subsequent data coding process. All the interviews,
including those with global Avon executives senior to our target population,
were tape-recorded, transcribed and meticulously analysed. They generated
a rich resource of individually coded behavioural statements, addressed
to their originating interview transcript, which were all slotted into
the ‘framework’.
From this the board were able to see some interesting
things. The data-distribution, illustrated in the chart above, illustrated
two new pieces of information ~ the range of capabilities that were utilised
by VP’s in dealing with critical elements of their roles, and the frequency
that those capabilities were brought to bear. In essence, this gave a good
indication of how VP’s spent their valuable time, and gave them some data
on which to start addressing issues like – is this how we should
spend our time?
Frequency is only one part of the picture of course.
For example, there was a competency category in the framework called ‘Pro-Active
Systems Thinking’ ~ a rather cumbersome title for activities to do with
focusing and utilising the systems capabilities of the organisation in
pursuit of the developing strategic agenda. Only a small number of behavioural
statements were coded to this category, but because of the strategic significance
of technology to the marketing, sales and distribution objectives of the
business, thinking pro-actively at board level about new systems applications
and tools was essential, and over time would become more so.
Using the frequency distribution, and by analysing
overlaps and differentiators, and by checking context and re-coding, the
original 23 ‘Framework’ categories were consolidated into the final 13
‘Competencies’ ~ giving the board a new, clear picture of their roles,
the key capabilities those roles required, and how their energies and capabilities
were focused.
Because of it’s strategic significance, ‘Pro-Active
Systems Thinking’ made it into the final cut as a separate category, as
did other categories with low frequency but high impact. Some key themes
emerged from the consolidated competencies model :
• that analytic and creative
thinking capabilities were critical to success at this level
• that functional management,
team leadership and focus on action and achievement did not disappear as
VP’s considered the loftier issues of strategy and vision; such matters
remained critical, at high levels of sophistication, and continued to demand
the appropriate attention of VP’s on a frequent basis
• that a new set of issues,
principally around the dynamics of establishing and building senior and
networked relationships, became a key feature at this level. This cluster
contained the clearest differentiators with the organisational levels just
below the board, and offered the biggest clues as to why previous attempts
at promotion or external appointment to the board had been sometimes unsuccessful,
and what future senior development programmes might focus on.
The competencies
that were identified through this process are shown in [X], with some included
in detail as illustration. Within them, a set of consistent and differentiating
themes emerged which conform to Elliott Jaques3 pioneering work
in identifying and assessing meaningful management ‘strata’ by analysis
of the time-horizons featuring in different roles (as distinct from typical
organisational levels which are more usually defined by pay and status
than real differentials in work content). It was clear to the Board that
they were operating much of the time in relatively short time horizons
~ peaking at around 18 months to 2 years ~ whereas the strategic demands
and expectations of the business required thinking and action over a 3
to 5 year horizon (moving from Strata III to Strata IV in Jaques terms).
One key impact of their current mode was that the people under them were
not allowed the room to think and act in time-scales appropriate to their
nominal level, and were not therefore developing senior management skills
in this important respect ~ and so on down the management chain.
Jaques two other key themes ~ task complexity
(the demand side of the equation) and cognitive processing capability (the
supply side) are also reflected effectively in the competency work, and
run consistent with the time-horizon data.
Board-Level Role Analysis : Doing It For
Themselves…
The key stage after the completion of the competency
model, using the springboard of a successful Board presentation, was to
move to an analysis of a ‘generic VP’ role, profiled across the model.
The intention was to identify the threshold for new-entrants at this level,
and to isolate the factors that differentiated this role from those at
the level just below the board. For this stage, Board members were fully
trained and used as the analysts; the result was theirs, not HR’s or anyone
else’s.
There is not space here to detail the role-analysis
process ~ but essentially it focused around using the differentiated behavioural
levels identified within the competencies to specify the difference between
what may be acceptable as a new entrant at this level as against the reasonable
expectations of experienced board-level practitioners. The board recognised
that, in the absence of the information the competency model offered them,
their collective approach to new entrants had tended to be a little unforgiving,
expecting them to ‘hit the ground running’. Unfortunately, some of them
just hit the ground.
Behavioural Assessment : Board Selection
and beyond…
Concurrent with the research and development of
the competencies model, an assessment process had been designed for use
in development and selection applications, and all board members were then
trained in the skills necessary for behaviourally-based interviewing, and
in collecting and analysing behavioural data. This was to ensure that they
understood the process by which decisions using these outputs were made,
and so that they could work as skilled assessors in the forums which generated
subsequent promotion, development and selection outcomes. Again, the decisions
would be theirs, and they made sure they were equipped to make them.
The first use of the competency model and the
role analysis based on it was in a board selection process, assessing both
internal and external candidates through a programme illustrated below.
The assessment ultimately produced a successful candidate who, as acknowledged
by the board-level assessors, was not necessarily in the ‘Avon image’,
but who did have the capabilities that had been identified as most important,
at the appropriate levels. Their own data and analysis said so. Since appointment,
that individual has proceeded to sponsor an aggressive agenda of change
focused on the strategically critical areas of customer service and product
distribution, exactly the issues identified by the board as key deliverables
in advance of the recruitment process.
The fact that the first use of this work was in
a selection context was not entirely intentional, but as events unfolded,
that became the priority. Shortly after the selection forum, adaptations
were made to the process which got back to the original agenda ~ internal
development for senior, aspiring and talented individuals within the business.
For the selection forum, a specific profile for that particular role had
been drawn up, using the same process as before. In the development context,
the profile for the ‘generic new entrant VP’ was the point of comparison
for participants, and given the exclusively internal population and the
purpose of the exercise, a higher degree of openness around the criteria
was possible. In particular, nomination for the development centre commenced
with the potential participants self-nominating on the basis of their own
assessment of their readiness, using the behavioural data and VP profile
to educate their analysis.
The ‘new technology’ of competencies and behavioural
data enabled nominees to better understand the likely requirements of them
at the VP level, and to be more objective ~ particularly with themselves
~ about where they currently stood in relation to the competency requirements
of the senior roles. At this stage, some chose to work on a few things
before putting themselves forward; others moved on into the development
centre with greater confidence and an appreciation of what they might need
to learn.
Over time, the application of the VP model has
extended beyond succession-based selection and development applications
and into development and performance management applications for the executive
team themselves, driven by Bronwen and sponsored by a new President for
the UK, appointed after the model had been researched and introduced. The
use of competencies in these ways has had other organisational impact,
enabling for example a much more open and engaging approach to cross-functional
movement and joint-sponsorship of development placements and mentoring.
(One of the critical points of understanding for the board was that success
at this level required first-hand experience of a range of functions; the
‘specialist expert’ route to the top was not viable in the face of modern
business-management complexities.)
For the development agenda at Avon, the lid is
being lifted-off to the extent that many of those with real potential are
appreciating and being challenged by the new expectations, while others
may show signs of discomfort in the new terrain. The flatter structures,
broader roles and complex demands of this new era are not comfortable for
everybody, and it is in addressing the emergent needs of these new constituencies
that the HRD function is now focussing, against a clear strategic template,
and with clear competency analysis on which to progress.
The programme of competency analysis has now extended
into all other levels of management, involving a cross functional and diagonally
representative project group, all trained in the key elements of competency
discovery. The outcomes of the VP level programme continue to develop;
they are best summed-up by Bronwen Curtis’ final two slides at last year’s
competency conference
‘Knowing what to do about it all’ is not a bad
outcome, given the complexities, risks and high political profile of the
agenda. It says a lot about the power of competencies to offer solutions
to business problems ~ particularly when the board is with you.
Notes and references
1. Bob Garratt, The Fish
Rots from the Head, Harper Collins Business, 1996
2. John P. Kotter, Leading
Change: Why Transformation Efforts Fail, Harvard Business Review, March
1995
3. Elliott Jaques, Requisite
Organisation, Cason Hall & Co., 1989;
Elliott
Jaques and Stephen Clement, Executive Leadership, Cason Hall &
Co., 1991
This article was originally published in Competency & Emotional Intelligence / Volume 5. Number 4, Summer 1998.
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