Latest Public Sector News

01.06.12

Redeployment, not redundancy

Source: Public Sector Executive May/June 12

In the March/April edition of PSE, we covered the CIPD’s report into trust at public and private sector organisations, and the high praise it gave to the way Sunderland City Council has handled budget cuts without resorting to redundancies. We asked Sunderland’s head of organisational development and workforce development Dave Rippon and council leader Paul Watson how they did it.

Lessons fom Sunderland

Virtually all local authorities of a significant size have launched redundancy programmes in the face of unprecedented and ongoing budget cuts.

But for Sunderland City Council, the name of the game over the past 18 months has been redeployment, not redundancy. Via its innovative ‘SWITCH’ programme, employees whose posts are no longer required or no longer affordable have been talent-matched to other parts of the organisation, ensuring that no-one has had to take redundancy, while the workforce can still be shrunk via natural wastage.

‘Bewildered looks’

This approach was given high praise by the Chartered Institute of Personnel and Development in its recent report into trust and its impact on the workforce, efficiency and innovation.

As reported in the previous edition of PSE, the report said: “Unusually, and possibly uniquely, judging by the bewildered looks the HR team has received from counterparts elsewhere in the country – Sunderland City Council is trying to achieve [its multi-million pound budget] reduction without taking the obvious option of cutting headcount. In a city already buckling under high levels of unemployment, and acute social and health-related problems, it has argued that to throw another few thousand people out of work would be so unpalatable as to be impossible for it to contemplate.”

This approach has not only been good for the workers who may otherwise have lost their jobs, and the city’s economy, but also for morale among all the remaining staff – which has a knock-on effect on productivity, efficiency, and trust in the council’s leadership team.

Dave Rippon, Sunderland’s head of organisational development and workforce development, told PSE: “Having to reduce our revenue spending by almost one-third over a four year period, we faced a number of options to deliver the necessary downsize in our workforce.

“We could have adopted the commonly used approach of mass redundancies. Whereas this was quick, certain and relatively simple, it had a number of negative factors: the voluntary route would be very expensive, putting even greater pressure on financial resources; mass redundancy is known to have a very negative impact on employee trust and engagement – ‘survivor syndrome’; given the impact of the recession on the local community, adding to this was seen as something the council should strive to avoid. Over 70% of the workforce live in the city.

“A second option was to focus strongly on redeployment, moving people from jobs that are no longer needed into vacancies. Traditionally, enforced redeployment is fraught with problems. Enforcing such a move usually requires the threat of redundancy, people feel pushed into jobs they don’t want to do, managers feel they have people forced on them, who they don’t want, and the final result is often square pegs in round holes, with the resulting motivational, behavioural and performance problems.”

Values-led approach

Rippon explained: “We needed an approach which could move people around the organisation, ensuring that they filled all vacancies internally to maximise their natural wastage, while at the same time having a workforce which would be able and willing to deliver the type of performance which would protect the people of Sunderland from the impact of the council’s financial challenges. Moreover, the clear instruction from the leader of the council, Cllr Paul Watson, and the chief executive, Dave Smith, was to stick to the council’s values of ‘Proud, Decent and Together’.

“To achieve this, we adopted an approach which is based on the ‘talent’ or ‘strengths’ approach of positive psychology.

“We assessed the personal strengths of individual employees. Not just their work experience and qualifications but, more importantly, what makes them tick as individual human beings. Using an online tool, staff identify individuals’ key strengths and have an automated matching process which then matches them to jobs, which have also been analysed on the basis of these personal strengths. The assessment process is fully automated, as is the matching process, which minimises the resources needed to manage them – there are 3,500 employees currently assessed in what is know as the Internal Jobs Market. In addition, the council created an inhouse pool of people who are moving between jobs and working on temporary projects in the meantime.

“This ‘SWITCH’ team has 350 people currently with 120 having already moved on to new opportunities both within and outside of the council.”

Safeguarding jobs

He admitted that the team in charge faced “many challenges” in implementing this, and that they got important input from – and worked well with – managers, unions, employees and senior management. He praised the “clear, consistent and visible leadership” from Watson and Smith as leader and chief executive respectively.

Cllr Watson told us: “Sunderland had been planning for reductions in public funding and adopted a measured and managed response to these. We pledged to do all we can to avoid mass redundancies on current budget allocations as these would have a negative impact on the city’s economy as well as individual employees.

“The city council welcomes the recognition that our approach is receiving. However, our priority continues to be safeguarding public services and jobs, ensuring we continue to look after and support our most vulnerable residents and continuing to attract new businesses to invest in the city.”

Rippon noted that there remains “much work to do”. The recession has driven staff turnover down to around 3%, but he said the results so far (see panel) show that SWITCH has “overdelivered on expectations”, and will become a long term feature of the council’s talent strategy.

SWITCH success

The results of the approach are now visible:
• The workforce has downsized by 20% over three years, with no redundancies (either voluntary or compulsory)
• The council’s business operating model has fundamentally transformed with thousands of people moving into different roles and/or directorates
• The first year of downsizing saw a revenue saving of £58m and the second year £24m with improved service outcomes and improved customer satisfaction
• In an anonymous survey, managers recruiting people through this process have rated the performance of recruits as ‘excellent’ 64%, ‘good’ 24%, ‘satisfactory’ 12%, ‘poor’ 0%
• Anecdotal comments include: “I’ve worked for the council for over 20 years, and this is the most I’ve enjoyed my job”; “I would never have applied for this job but I love it”; “In the past, I wouldn’t have considered him for the shortlist, but he’s one of the best care managers we’ve ever had”; “I didn’t believe in this approach to recruitment but I’ll hold my hands up, I was wrong”; “I’ve worked for the council for 19 years and was becoming a bit stale, now I feel 25 again, refreshed and excited to come to work”.

Tell us what you think – have your say below, or email us directly at opinion@publicsectorexecutive.com

Comments

Timh   05/07/2012 at 14:30

Good effort by Sunderland, no doubt.

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