Geest: we are tough on poor staff, but reward the good

Managing your staff in a large food business which operates across a number of sites and is undergoing major restructuring in a tough business environment is a complex business.

After all, you want to retain your best people while adapting to the changes such a fast moving sector requires. It is an issue that fresh prepared foods and produce supplier Geest understands only too well. It recognises that the shortage of "good people" across the sector poses a strategic business risk in itself.

In its interim results Geest announced that there would be integration of some of its complementary business units. This is an acceleration of an efficiency programme begun in 2003, which is scheduled to run until 2007 at least (Food Manufacture October 2004, p12).

"We are growing, but need to be perceptive about how we manage," says Geest's group HR director Mark Martin. And he should know, as he is having to juggle some tricky personnel issues, involving closures at some sites and expansion at others.

As part of the restructuring, which meant the closure of three factories over the past year and the opening of other sites, well over 10% of management jobs have been made redundant. But the remarkable thing is, in many cases the people who lost their jobs have been found alternative employment elsewhere within the business.

This, claims Martin, is all thanks to forward planning. Expecting the closures, Geest put in place a mechanism -- called Decider 2 -- to ensure it found new positions for the staff it needed to take the business forward.

Geest's chief executive Gareth Voyle has said he wanted to keep individuals that were performing well, while being "tougher on poor performers". And Martin has been assigned the task of putting this into practice: "We are restructuring, becoming more efficient, and at the same time we work very hard to make sure we don't lose good managers," he says.

Geest conducts weekly reviews of vacancies across the group, matching them up with people whose jobs are being made redundant but which it wants to keep. Sometimes this occurs in advance of individuals concerned knowing, claims Martin. In fact, in one particular example where a factory was marked for closure, all the employees were reallocated jobs at a nearby joint-venture factory.

For some people affected, the moves represent a promotion. For example, in the recent amalgamation of management at Bourne Salads and Bourne Stir Fry in Lincolnshire, 11 individuals ended up in better jobs, says Martin.

For this approach to work, clear communication with staff is vital. It is important that people involved understand the business and economic logic behind the decisions. And as a result, Martin claims morale has been maintained in what would otherwise have been a very disruptive process.

"We are very practical in how we match jobs in the business units," he says. "People in Geest are used to changing jobs. There isn't the fear that there would be in other businesses." As a demonstration of its commitment to staff it wants to retain, it also operates what it calls a 'red circle' system, which means paying some the same salary even though the new job may not justify it.

However, at the time of our meeting, around 145 "poor performers" had been identified, mainly in white collar positions. While many had gone or were in the process of going, 92 were expected to improve to acceptable levels -- "quite a hard process", Martin admits.

Succession Planning

The group employs around 1,000 managers of which there is a 10% turnover each year. Around one-third of replacements come from outside the company, while a third are developed internally. The other third transfer from other Geest businesses. "That rate of movement around the organisation I would argue is a lot higher than any of our competitors," he says.

Martin is a great believer in succession planning. All its 36 general managers have worked for other Geest businesses in their time, with the usual stint being three to five years in any one post -- up from two to three a few years back when Geest was in a period of rapid growth.

"That is true not just for general managers, but for a lot of the positions too," he adds. "The first thought of someone when they get a vacancy is 'who have I got internally?', because I can trust the internal person, because I know they are at the right level."

He is also very proud of Geest's performance management assessments, which place particular emphasis on an individual's 'values' or 'people skills'. "Values are so important," he says. "What you care about matters."

Martins adds: "The problem with any appraisal is that you are actually doing three different things. You are looking at someone and saying 'you are paid to do this' -- we call them accountabilities. We also say 'you had an objective to achieve this last year and this is how you have done against it'. And we also say -- and this is the bit that often confuses -- 'this is the way in which you do it'."

But across the sector, Martin admits there are serious shortages of really good middle managers. "We can't find the calibre of external recruits when advertising for technical and factory managers and that has become a critical situation for us."

He believes the reasons for this are two-fold. First, the skills required of factory managers today are much greater than they ever were. Secondly, he attributes the shortage to Geest's tough selection process. "We have become much better at recruiting," he claims. "We recruit everyone via detailed assessment processes that involve role plays as well as psychometric tests and interviews ... which means you can't make as many mistakes."

For those particularly able souls -- mainly graduate employees -- Geest also operates an 'accelerated management scheme' (AMS). It has identified 10 key universities from which it recruits and has been taking on eight food technology graduates a year for several years. There are currently 67 AMS in the programme covering manufacturing, technical, development, produce and finance.

"We don't bring high calibre people into ivory tower environments doing projects," he says. "They go straight into real jobs. So, you might go in and be a supervisor in a factory -- which is a bit scary -- but if you are the right calibre, it is exactly what you want."FM