The Wider Role and Benefits of Investors in People

Transcription

1 RESEARCH The Wider Role ad Beefit of Ivetor i People Mark Cox ad Rod Spire PACEC Reearch Report RR360

2 Reearch Report No 360 The Wider Role ad Beefit of Ivetor i People Mark Cox ad Rod Spire PACEC The view expreed i thi report are the author' ad do ot ecearily reflect thoe of the Departmet for Educatio ad Skill. Quee Priter Publihed with the permiio of DfES o behalf of the Cotroller of Her Majety' Statioery Office. Applicatio for reproductio hould be made i writig to The Crow Copyright Uit, Her Majety' Statioery Office, St Clemet Houe, 2-16 Colegate, Norwich NR3 1BQ. ISBN Jue 2002

3 Cotet Executive Summary...3 Backgroud 3 Aim ad objective of the reearch 3 The fidig of the reearch 3 1. Itroductio Backgroud Aim ad objective of the reearch Approach ad methodology Structure of the report ad preetatio of urvey reult Ivolvemet with Ivetor i People Itroductio Objective i puruig the Stadard Barrier to bet practice i HR maagemet Fiacial ad other upport received i puruig the Stadard Awaree ad udertadig of Ivetor i People amogt No- Ivetor Barrier to ivolvemet Itermediate Effect of Ivetor i People Itroductio Achievemet of objective i participatig Effect o Recogied Orgaiatio' HR maagemet ad practice Effect o Committed Orgaiatio' HR maagemet ad practice HR practice i No-ivetor orgaiatio Additioality Effect o iteral reource Buie Performace Effect Itroductio Compario of buie performace Subjective view of the impact of Ivetor i People o performace Wider Effect Itroductio Fidig from the Survey of employee Employer' perceptio of wider effect Ivetor i People Compared to Other Stadard ad Accreditatio Itroductio Ivolvemet with other tadard ad accreditatio Relative uefule of Ivetor i People Ue of other good practice Maitaiig ad puruig the tadard Itroductio Overall aemet of Ivetor i People Re-aemet amogt accredited orgaiatio Progre of Committed Orgaiatio The Cot ad Beefit of Ivetor i People Itroductio 65 Page 1

4 Cotet 8.2. Defiitio of cot-beefit aalyi ad of rate of retur The approach adopted The reult Leo to be leared for future cot-beefit aalyi ad /or meauremet of rate of retur Cocluio Geeral cocluio Cocluio o the pecified reearch iue 72 Appedix A:...Backgroud ad Characteritic of Orgaiatio Surveyed 75 A1 Itroductio 75 A2 Type, ector, age etc 75 A3 Growth objective ad culture 77 A4 Maagemet of traiig ad developmet 80 Appedix B:Diaggregated Reult from the Survey of Recogied Orgaiatio 83 Appedix C:Diaggregated Reult from the Survey of Committed Orgaiatio 127 Appedix D:...Diaggregated Reult from the Survey of No-Uer 164 Page 2

5 The Wider Role ad Beefit of Ivetor i People Executive Summary Backgroud For more tha te year, Ivetor i People ha bee the Govermet' flaghip workforce developmet iitiative, providig a framework for good practice ad ivetmet i the developmet of employee at all level withi a orgaiatio. Achievemet of the (Ivetor i People) Stadard i ope to all orgaiatio, irrepective of ize, ector, ad owerhip. The Stadard erve a a bechmark agait which orgaiatio are aeed. Sice it iceptio, the umber of orgaiatio becomig recogied Ivetor i People ha grow teadily to total over 26,000 by the ed of 2001, with a further 20,000 or o formally committed to achievig the Stadard. Withi the medium-ized ad large employer ector, aroud 35% of orgaiatio are ow recogied Ivetor i People. However, a maller proportio of mall orgaiatio (le tha 50 employee) have ought recogitio. Aim ad objective of the reearch Previou reearch o the effect of Ivetor i People ha how that the Stadard ha a poitive impact o traiig ad developmet trategy withi committed orgaiatio. Although the recogitio proce ad the iteral, immediate effect of Ivetor i People have bee widely reearched, the wider role ad beefit of the Stadard (e.g. peritece ad diffuio of effect withi orgaiatio, effect o the workforce ad o orgaiatio ot directly ivolved) are le well udertood. Thi reearch wa, therefore, udertake i the cotext of the eed to udertad the wider cotributio of Ivetor i People more fully. Key uderlyig aim of the reearch were: (a) To derive iformatio that 'poitio' Ivetor i People both withi orgaiatio ad i term of it wider impact o participatig ad oparticipatig firm, o idividual ad o the ecoomy more geerally; ad (b) To erve a a precuror to a fuller cot-beefit aalyi ad / or to idetificatio of retur ad rate of retur to idividual, employer, ad ociety from workforce developmet. The fidig of the reearch Aalyi of the reult of urvey of Recogied Orgaiatio, Committed Orgaiatio ad No-Ivetor (ivolvig iterview with 1,012 employer) ad of Employee of Recogied ad Committed Orgaiatio (ivolvig feedback from 278 employee) led to the followig broad cocluio: Effect o orgaiatio' operatio ad performace Thi reearch cofirmed the fidig from previou reearch that Ivetor i People ha a clear ad poitive impact o Recogied ad Committed Orgaiatio' approache ad dedicatio to traiig ad developmet. It howed that participatig orgaiatio geerally achieve their objective i puruig the Stadard; ad are largely atified with their experiece of the Stadard ad the beefit it provide. It alo howed that the chage Page 3

6 The Wider Role ad Beefit of Ivetor i People - Executive Summary orgaiatio make i puruit of the Stadard ad after they have reached it, ad the other itermediate effect ad performace beefit they experiece a a reult, are additioal to a large extet. Moreover, compario with the fidig of previou reearch idicate that the objective i puruig Ivetor have wideed i recet year. For itace, oly 10% of orgaiatio ivolved with Ivetor urveyed i aticipated icreaed quality of good ad ervice a a reult of their ivolvemet, while the curret (2001) urvey foud that early a half of orgaiatio purued thi a a broad objective. Likewie, oly 8% aw Ivetor improvig their fiacial performace i 1995, compared with 25-30% that ow ee Ivetor a a mea to icreaed profitability ad/or buie growth. Wider effect Thi reearch ha alo demotrated that there are wider effect of orgaiatio' participatio: The majority of orgaiatio cotiue to develop their HR pla, ytem ad procee pot-recogitio (ad ot imply i order to gai rerecogitio). There i alo evidece that the effect of the Stadard perit ad, if aythig, accumulate rather tha fade over time. The icreae i adoptio of formal traiig pla, tructure etc. acro all orgaiatio, icludig o-ivetor, ice the mid 1990 eem at leat i part to have bee due to the growig awaree of Ivetor i People ad the eed for effective HR maagemet, albeit that mot o- Ivetor do ot appear to fully udertad what Ivetor actually ivolve. It i uclear to what extet employee beefit from orgaiatio' participatio i Ivetor i People i term of the et additioal amout of traiig received. However, employee of orgaiatio ivolved i Ivetor i People idicate that there i a et poitive impact o their attitude toward educatio ad traiig (both related ad urelated to their job) ad their performace at work. Employer ted to hare thee view. A few orgaiatio recogie that their ivolvemet affect their cutomer, upplier ad competitor (but it ha to be admitted that mot do ot kow whether there have bee ay effect). However, the reult of the urvey would idicate that progre from commitmet to recogitio ad beyod i importat for the achievemet of wider beefit, iteral ad exteral, ad while the majority of employer report atifactory progre toward recogitio, up to 45% of orgaiatio had either abadoed or upeded their commitmet or were makig lower tha expected progre toward recogitio. The market poitio of Ivetor i People 1 The Retur O Ivetor. Ititute for Employmet Studie. Report 314, Page 4

7 The Wider Role ad Beefit of Ivetor i People - Executive Summary I term of the overall 'poitio' of Ivetor i People, thi reearch ugget that the Stadard appeal to orgaiatio that are relatively ambitiou to grow, ad that already attach relatively great importace to huma reource maagemet ad developmet. Thee factor hould be take ito accout i the aemet of the wider role ad beefit of the Stadard ad it marketig. Recogied Orgaiatio are more likely tha other orgaiatio to have achieved other exterally accredited tadard. However, Ivetor i People ad other tadard are geerally ee a complemetary; ad there i o clear evidece that Ivetor i People lead to the puruit of other tadard, or vice vera. Recogied ad Committed Orgaiatio ted to ue other good practice, but the practice they follow do ot obviouly mark them out a beig at i the vaguard of the leadig edge i HR maagemet ad developmet. Toward a cot-beefit aalyi of Ivetor i People The experimetal approach toward the meauremet of rate of retur aociated with Ivetor i People adopted by thi reearch proved to have diappoitig outcome, but it did cat light o what might be a feaible (albeit loger-term) method of idetifyig the cot-beefit balace. Page 5

8 1. Itroductio 1.1. Backgroud Thi report preet the reult of reearch ito the wider role ad beefit of the Ivetor i People tadard. The reearch wa udertake by ad Corporate Ecoomic Coultat Ltd (PACEC), for the Departmet for Educatio ad Skill (DfES) For more tha te year, Ivetor i People ha bee the Govermet' flaghip workforce developmet iitiative, providig a framework for good practice ad ivetmet i the developmet of employee at all level withi a orgaiatio. However, it i about more tha imply traiig. Rather, it i iteded to be a dyamic ad flexible tool which focue o the erichmet of huma capital a a mea of eablig orgaiatio to purue a rage of buie or orgaiatioal aim ad objective Achievemet of the (Ivetor i People) Stadard i ope to all orgaiatio, irrepective of ize, ector, ad owerhip. The Stadard erve a a bechmark agait which orgaiatio are aeed ad i maitaied ad promoted by Ivetor i People UK, a o-departmetal public body. The Stadard i aeed ad delivered by the Learig ad Skill Coucil (formerly TEC) i Eglad ad Wale, ad LEC i Scotlad Sice it iceptio i the late 1980, the umber of orgaiatio becomig recogied Ivetor i People ha grow teadily to total over 26,000 by the ed of 2001, with a further 20,000 or o formally committed to achievig the Stadard. Withi the medium-ized ad large employer ector (i.e. thoe with more tha 50 employee), more tha 12,000 employer are ow recogied Ivetor i People, equivalet to aroud 35% of the populatio of thoe employer. However, a much maller proportio of mall buiee (le tha 50 employee) have ought recogitio Aim ad objective of the reearch Previou reearch o the effect of Ivetor i People ha how that the Stadard ha a poitive impact o traiig ad developmet trategie ad practice withi orgaiatio ivolved with Ivetor i People 3. Although the recogitio 2 I part due to the greater focu util recetly o attractig larger orgaiatio ito Ivetor i People. 3 See Review Of Reearch ad Evaluatio o Ivetor i People DfES Reearch Brief, RBX 18-01, October Page 6

9 Itroductio proce ad the iteral, immediate effect of Ivetor i People have bee widely reearched, the wider role ad beefit of the Stadard (e.g. the peritece of impact, effect o the workforce ad o orgaiatio ot directly ivolved) are le well udertood. Thi reearch wa, therefore, udertake i the cotext of the eed to udertad the wider cotributio of Ivetor i People more fully The reearch leadig to the productio of thi report wa, therefore, cocered with obtaiig evidece that would upport idetificatio of potetial trategie toward workforce developmet. Key uderlyig aim of the reearch were: (a) To derive iformatio that 'poitio' Ivetor i People both withi orgaiatio ad more broadly, withi the ecoomy ad the 'learig ociety' more geerally; ad (b) To erve a a precuror to a fuller cot-beefit aalyi ad / or to idetificatio of retur ad rate of retur to idividual, employer, ad ociety from workforce developmet Aociated with thee two aim, importat reearch iue icluded the followig: (a) The extet to which Ivetor i People ha impacted o orgaiatio ivolved with the Stadard. I particular, for recogied orgaiatio, ha the proce of achievig the Stadard timulated ogoig chage ad developmet withi the orgaiatio, with regard to HR practice, tructure ad culture, epecially potrecogitio? I other word, have the beefit perited ad wideed, or ha Ivetor i People bee a oe-off, leadig to little o-goig developmet? Wa Ivetor i People a eceary coditio for thee chage? Do thee chage differ acro ector ad type of orgaiatio? (b) Are recogied orgaiatio geerally i the vaguard of 'leadigedge' HR practice? What do employer geerally ow expect from HR iitiative? Ad where ad how large are the gap betwee practice ad expectatio o the part of the recogied orgaiatio ad orgaiatio more geerally? (c) The ature ad cale of 'pillover' impact amogt employer, icludig No-Ivetor. How far ha Ivetor i People permeated the approach to HR to orgaiatio more geerally; i raiig the profile of huma capital; i realiig wider ecoomic beefit, beide thoe to the orgaiatio ivolved with the Stadard? (d) The ature ad cale of additioality, ad the idirect impact Ivetor i People may have had o idividual employed withi recogied orgaiatio, i particular i the impact o idividual' take-up of, ad attitude to learig ad traiig; o the retur to traiig for idividual that Ivetor i People may have itigated; ad o their employability ad ocial 'icluivity' Approach ad methodology I order to addre the aim ad to explore the iue above, a large cale programme of urvey baed-reearch wa Page 7

10 Itroductio udertake. The programme had five mai compoet: 1. A urvey of orgaiatio which have achieved the Stadard (referred to hereafter a the Survey of Recogied Orgaiatio). 2. A urvey of orgaiatio which have committed to achievig the Stadard, but which have ot yet doe o (referred to hereafter a the Survey of Committed Orgaiatio). 3. A urvey of orgaiatio which have had o ivolvemet with the tadard; i.e. have either achieved the Stadard or are committed to it (referred to hereafter a the Survey of No-Ivetor). 4. A urvey of employee of orgaiatio which have achieved the Stadard (referred to hereafter a the Survey of Employee of Recogied Orgaiatio). 5. A urvey of employee of orgaiatio which have committed to achievig the Stadard (referred to hereafter a the Survey of Employee of Committed Orgaiatio) The urvey of Recogied Orgaiatio, Committed Orgaiatio ad No-Ivetor were all baed maily o telephoe iterview uig tructured quetioaire. Thee telephoe iterview were upplemeted by a umber of face to face iterview which followed the ame broad tructure a the telephoe iterview, but which were deiged to eable orgaiatio' repoe to particular quetio to be examied i greater depth. I all three urvey the ample were tratified to eure a igificat umber of iterview with orgaiatio i differet employmet ize bad 4. I the cae of the urvey of Recogied Orgaiatio ad Committed Orgaiatio the ample were alo tratified to eure broadly equal umber of iterview with orgaiatio which had achieved, or committed to, the Stadard before ad from oward The quetioaire for the urvey of Recogied Orgaiatio, Committed Orgaiatio ad No-Ivetor were deiged to eure a far a poible that the three group were aked the ame quetio. Thu, all three type of orgaiatio were aked about: their backgroud characteritic ad culture (e.g. ector, age, growth objective, importace attached to traiig ad developmet ad approach to HR maagemet) their ue of other (i.e. No-Ivetor i People) tadard ad accreditatio tred i their buie / orgaiatioal performace. Similarly, both Recogied Orgaiatio ad Committed Orgaiatio were 4 Four employmet ize bad were ued: i) fewer tha 10 employee, i.e. micro-orgaiatio; ii) employee, i.e. mall orgaiatio; iii) employee, i.e. medium-ized orgaiatio; ad iv) 250+ employee, i.e. large orgaiatio. 5 The before / oward cut-off wa ued to ditiguih hort ad medium term effect of achievig the tadard, or committig to it, from loger term effect. I the cae of Ivetor, the cut-off date i alo igificat becaue orgaiatio that achieved the tadard before hould have bee through the proce of re-recogitio. Page 8

11 Itroductio aked about: their reao for, or objective i, puruig the Stadard the itermediate ad performace effect, or effect to date, of achievig, or puruig, the Stadard the wider effect (e.g. o employee ad other orgaiatio), or effect to date, of achievig, or puruig, the Stadard uefule of other tadard ad accreditatio, compared to Ivetor i People barrier, if ay, to re-recogitio or achievig the Stadard. The No-Ivetor were aked about their awaree ad udertadig of the Stadard ad the barrier to their ivolvemet The urvey of Employee of Recogied Orgaiatio ad of Committed Orgaiatio were baed o elf-fill quetioaire, which were ditributed amogt their taff member by Recogied Orgaiatio ad Committed Orgaiatio which were iterviewed face to face 6. The quetioaire for both urvey were deiged to cover the followig iue: job atifactio ad perceptio of employer commitmet to traiig ad devlopmet job-related ad urelated educatio ad traiig i the lat year awaree of orgaiatio' ivolvemet i Ivetor i People ad udertadig of the Stadard perceptio of the effect of Ivetor i People o the orgaiatio ad the idividual Table 1.1 how the target ad achieved ample ize for the five urvey udertake. 6 It wa ot poible, therefore, to impoe repoe quota to eure that the ample achieved were repreetative. Page 9

12 Itroductio Table 1.1 Target ad achieved urvey ample Survey: Target Sample Size Achieved Sample Size Recogied Orgaiatio Committed Orgaiatio No-Ivetor Employee of Recogied Orgaiatio Employee of Committed Orgaiatio 500 telephoe 493 telephoe iterview iterview plu 100 face plu 100 face to face to face 300 telephoe iterview plu 60 face to face 200 telephoe iterview plu 40 face to face Approximately 300 elffill retured by mail Approximately 300 elffill retured by mail 297 telephoe iterview plu 60 face to face 222 telephoe iterview plu 40 face to face 193 retured 85 retured Source: All urvey, PACEC Appedix A provide a backdrop to the aalyi i the ubequet chapter of thi report by examiig ad comparig the backgroud ad characteritic of the three group of orgaiatio urveyed. However, i ummary, it how that there were ome igificat differece i the characteritic of the orgaiatio urveyed i term of their ize, buie activity, growth objective ad approache to huma reource maagemet. For example: Recogied Orgaiatio were more likely to be public ector orgaiatio ad le likely to be buiee tha Committed Orgaiatio or No-Ivetor. Recogied Orgaiatio were, o average, larger tha Committed Orgaiatio, which, i tur, were larger tha the No- Ivetor. Two third of Recogied Orgaiatio ad Committed Orgaiatio wated to grow moderately, but No-Ivetor were more likely to wat to tay the ame ize. There were alo differece i the importace the three group attached to, or approached, huma reource maagemet: Ivetor ad Committed Orgaiatio perceived huma reource maagemet ad developmet a more importat for orgaiatioal ucce tha did No-Ivetor. No-Ivetor were coiderably le likely tha the Ivetor ad Committed Orgaiatio to have a HR departmet or a HR maager, or to have a pecific traiig ad developmet budget. Few Ivetor ad Committed Orgaiatio had dedicated Ivetor i People champio or Ivetor i People maager. A mall miority of Committed Orgaiatio had o oe repoible for Ivetor i People. Mot with a Ivetor i People champio or maager had coidered what would happe if thi pero left the orgaiatio, but a igificat miority had ot. Page 10

13 Itroductio Some additioal work wa udertake i order to addre the particular aim that the reearch hould erve a a precuror to a fuller cot-beefit aalyi ad / or to idetificatio of retur ad rate of retur to idividual, employer, ad ociety from workforce developmet. Thi ivolved a brief dek baed review of previou relevat reearch, coupled with followup iterview with a ub-ample of Recogied Orgaiatio maily iteded to explore the flow of cot ad beefit over time. Thi additioal work ad it fidig are decribed i more detail i Chapter Structure of the report ad preetatio of urvey reult The report i tructured a follow: Chapter 2 maily aalye Recogied Orgaiatio' ad Committed Orgaiatio' objective i puruig the Stadard; ad No- Ivetor' awaree ad udertadig of Ivetor i People. Chapter 3 coider whether orgaiatio atify their objective i puruig the Stadard; ad look at the itermediate effect (e.g. chage i HR maagemet ad practice) the Stadard brig about. Chapter 4 aee the buie performace effect of committig to ad achievig the Stadard. Chapter 5 examie the wider "exteral" effect of Ivetor i People, icludig a aemet of how it impact o employee of orgaiatio ivolved. Chapter 6 ue the urvey data to compare Ivetor i People with other exterally accredited tadard ad other good practice that Recogied Orgaiatio ad Committed Orgaiatio have adopted. Chapter 7 report orgaiatio' view o the overall uefule of Ivetor i People; ad addree the iue of what, if aythig, prevet Committed Orgaiatio achievig the Stadard ad what, if aythig, prevet Recogied Orgaiatio eekig rerecogitio. Chapter 8 et out the reult of the additioal work deiged to erve a a precuror to a fuller cot-beefit aalyi ad / or to idetificatio of retur ad rate of retur to idividual, employer, ad ociety from workforce developmet. Latly, Chapter 9 draw cocluio from the reearch ad highlight the implicatio for policy developmet Reflectig the fact that the Recogied Orgaiatio, Committed Orgaiatio ad No-Ivetor were aked the ame urvey quetio a far a poible, the data tabulatio i the mai body of the report directly compare the repoe of the three group. However, Appedix B alo how how urvey repoe varied withi the group, i.e. by breakig dow the reult accordig to ize of orgaiatio, broad ector ad type of orgaiatio (for all three group) ad accordig to date of commitmet or achievig the Stadard (for Recogied Orgaiatio ad Committed Orgaiatio). The text i the Page 11

14 Itroductio mai body of the report alo ote where there were large ad tatitically igificat differece i the urvey reult accordig to ize of orgaiatio. The data from the two urvey of employee are treated i the ame way, i.e. i the mai part of the report employee of Recogied Orgaiatio are compared with employee of Committed Orgaiatio ad differece withi the two group are examied i Appedix B. Page 12

15 2. Ivolvemet with Ivetor i People 2.1. Itroductio Maily a a prelude to the aalyi i the ubequet chapter of the variou output, outcome ad effect of Ivetor i People, thi chapter examie: Recogied Orgaiatio' ad Committed Orgaiatio' objective i puruig the Stadard; Barrier to the implemetatio of bet practice i huma reource maagemet outide the Ivetor i People framework; ad Whether ad to what extet Recogied Orgaiatio received, ad Committed Orgaiatio have received, exteral fiacial ad other upport to help them to achieve the Stadard Awaree ad udertadig of the Stadard amogt No-Ivetor i alo examied a a mea of aeig the barrier to it more widepread ue. Ad compario with previou reearch fidig 7 allow u to ae the extet to which the objective ad appreciatio/awaree of the beefit ad barrier of participatio have wideed i recet year Objective i puruig the Stadard The Recogied Orgaiatio ad Committed Orgaiatio had a imilar et of broad objective i puruig the Stadard. A Table 2.1 how, both group implicitly raked 'Efficiecy gai', 'Icreaed quality product ad ervice' ad 'Staff retetio ad eaier recruitmet' a their top three objective, ome way ahead of the buie performace idicator lited. The Committed Orgaiatio were tatitically igificatly more likely tha the Recogied Orgaiatio to pecify buie performace objective, but the differece were ot great. 7 Pricipally The Retur o Ivetor. Ititute for Employmet Studie (IES), Report Page 13

16 Ivolvemet with Ivetor i People Table 2.1 Broad objective i puruig the Stadard, % Recogied Orgaiatio Committed Orgaiatio Efficiecy gai Icreae i quality of product / ervice Staff retetio ad eaier recruitmet Icreae i profitability Buie growth Chage of corporate culture Other No. of Repodet We ca be 95% certai that figure i bold are differet from thoe for Recogied Orgaiatio Source: Survey of Recogied Orgaiatio ad Committed Orgaiatio, PACEC The 'Other' broad objective alluded to i Table 2.1 were mot frequetly pecified by both the Recogied Orgaiatio ad Committed Orgaiatio a (i decedig order): a deire for better or more formal HR ad traiig practice, a deire for iteral ad exteral recogitio of exitig good practice, ad improved commuicatio ad relatio with taff The diaggregated urvey reult (ee Appedix B) how that orgaiatio that had achieved recogitio i or later were igificatly more likely tha thoe that were recogied pre- to pecify buie growth ad efficiecy gai a a broad objective i puruig the Stadard. Thi might be a idicatio that Ivetor i People i icreaigly aociated with ehaced overall performace. However, there were o marked ize-related differece i the objective pecified The orgaiatio iterviewed face to face were alo ivited, where they had pecified more tha oe broad objective, to idetify their mai objective i puruig the Stadard. Amogt both the Recogied Orgaiatio ad the Committed Orgaiatio the deire for 'Icreaed quality of product ad ervice' wa at the forefrot. However, the Recogied Orgaiatio metioed 'Efficiecy gai' ad 'Staff retetio ad eaier recruitmet' a primary objective more frequetly tha Committed Orgaiatio, wherea the latter metioed 'Buie growth' ad 'Chage of corporate culture' more frequetly tha the former Compario with the fidig of previou reearch idicate that the objective i puruig Ivetor are wideig. For itace, oly 10% of orgaiatio ivolved with Ivetor at the time of IES 1995 urvey aticipated icreaed quality of good ad ervice a a reult of their ivolvemet. The 2001 urvey foud that early a half of orgaiatio purued thi a a broad objective. Likewie, oly 8% aw Ivetor improvig their 8 A wa idicated i Chapter 1, differece i the urvey reult accordig to ize of orgaiatio are oly referred to i the mai body of the report where the differece were large ad tatitically igificat. Page 14

17 Ivolvemet with Ivetor i People fiacial performace i 1995, compared with 25-30% that ow ee Ivetor a a mea to icreaed profitability ad/or buie growth. Coverely, relatively few metioed improved traiig practice a a broad objective i 2001 wherea i 1995 "improved traiig ytem" wa regarded a the mot importat aticipated beefit (metioed by a third of thoe ivolved) Thee fidig idicate that Ivetor ha become embedded withi orgaiatio' wider product ad fiacial trategie, beyod the HR fuctio Barrier to bet practice i HR maagemet Whe they were aked what had preveted them from implemetig bet practice i huma reource maagemet before they became a Recogied or Committed Orgaiatio, mall majoritie of both group idicated that there were o particular barrier ad that they already purued bet practice (Table 2.2). Ideed, the mot frequetly metioed barrier (lack of time) wa metioed by oly 6% of Recogied Orgaiatio ad 10% of Committed Orgaiatio. However, the face to face iterview (which provided better opportuitie for probig ad coidered repoe) foud that the mot igificat barrier were coervatim / traditioalim / reluctace to chage (amogt the Recogied Orgaiatio) ad a lack of time or a lack of udertadig / kowledge of HR maagemet (amogt the Committed Orgaiatio). Table 2.2 Barrier to implemetatio of bet HR practice before achievig or committig to the Stadard, % Recogied Orgaiatio Committed Orgaiatio Lack of time 6 10 Coervatim / traditioalim / reluctace to chage 4 2 Lack of udertadig / kowledge of HR mgt. 4 5 Cot / fiace geerally 3 5 Lack of awaree of Ivetor i People 3 5 Lack of kill 2 2 Lack of exteral advice ad upport 2 1 Rik ivolved 1 0 Uaware of fiacial upport from local TEC / BL 1 0 Other 7 4 Noe - already purued bet practice Noe- other 5 4 Do't kow No. of Repodet We ca be 95% certai that figure i bold are differet from thoe for Recogied Orgaiatio Source: Survey of Recogied Orgaiatio ad Committed Orgaiatio, PACEC Page 15

18 Ivolvemet with Ivetor i People 2.4. Fiacial ad other upport received i puruig the Stadard Table 2.3 ource, % The data i Table 2.2 might lead to doubt about whether Ivetor i People make much happe that would ot happe ayway. However, Table 2.3 ad 2.4 imply that a izeable miority of orgaiatio would ot have purued the Stadard without upport. Table 2.3 how that a majority of both Recogied Orgaiatio ad Committed Orgaiatio received i-kid upport from public ource to help them purue the Stadard, ad that a majority of Recogied Orgaiatio received public fiacial upport 9. Received fiacial upport? Receipt of fiacial ad i-kid upport from public Recogied Orgaiatio Committed Orgaiatio Ye No Do't kow No. of Repodet Received i-kid upport? Ye No Do't kow No. of Repodet We ca be 95% certai that figure i bold are differet from thoe for Recogied Orgaiatio Source: Survey of Recogied Orgaiatio ad Committed Orgaiatio, PACEC For it part, Table 2.4 ugget that, amogt thoe that received it, orgaiatio were roughly four time a likely to idicate that they would defiitely or probably have purued the Stadard without upport tha to idicate that they would defiitely or probably have ot purued it. However, it hould be oted that, epecially amogt the Recogied Orgaiatio, thi i a expot repoe, i.e. after beefit had bee ecured. I other word, it might be quetioed whether the proviio of upport i a uimportat a the data i Table 2.4 ugget The data tabulatio i Appedix B alo ugget that ize of orgaiatio ha a trog bearig o whether orgaiatio would have purued that Stadard without upport. For example, amogt the Recogied Orgaiatio that received fiacial upport, 30% of micro-orgaiatio (fewer tha 10 employee) ad 51% of mall orgaiatio (10-49 employee), compared to 60% of medium ized orgaiatio ( employee) ad 74% of large orgaiatio ( The term 'fiacial upport' ad 'i-kid upport' were ot defied i the urvey quetioaire. However, 'fiacial upport' clearly implie a ubidy or a grat. 'I-kid upport' implie the proviio of good ad ervice without charge. Page 16

19 Ivolvemet with Ivetor i People employee), idicated that they would defiitely or probably have purued the Stadard ayway. The fidig for the Recogied Orgaiatio i relatio to i-kid upport howed a imilarly trog ize correlatio. However, the repoe of the Committed Orgaiatio did ot appear to be iflueced i the ame way. Table 2.4 Effect of upport o the puruit of the Stadard, (% orgaiatio which received upport) Recogied Orgaiatio Committed Orgaiatio Would have purued Stadard without fiacial upport? Defiitely Probably Poibly Probably ot Defiitely ot 2 0 No. of Repodet Would have purued Stadard without i-kid upport? Defiitely Probably Poibly Probably ot Defiitely ot 3 2 No. of Repodet Source: Survey of Recogied Orgaiatio ad Committed Orgaiatio, PACEC 2.5. Awaree ad udertadig of Ivetor i People amogt No-Ivetor I term of icreaig the peetratio of the Stadard amogt o-ivetor, Table 2.5 iclude a importat fidig from the curret reearch, i that it highlight that there are coiderable obtacle to the icreaed uptake of the Stadard, ad therefore of wideig it role. I particular, it how ot oly that aroud 40% of the No-Ivetor iterviewed were previouly uaware of Ivetor i People, but alo that oly oe third of thoe aware of Ivetor i People claimed to udertad what it i about 10. I other word, the table implie that oly 20% of No- Ivetor are aware of the Stadard ad udertad it. The other 80% have either ot heard of Ivetor i People or do ot udertad it well, or at all. Thu, while Ivetor eem to have 10 The Skill Need i Britai report foud that 76% of orgaiatio urveyed were aware of the Stadard. However, thi icluded oly orgaiatio with more tha 25 employee, wherea half of the o-ivetor orgaiatio urveyed for the curret reearch had fewer tha thi umber. Page 17

20 Ivolvemet with Ivetor i People Table 2.5 i People, % wideed it role i term of raiig it profile amogt employer geerally (level of awaree grew teadily through the 1990 accordig to ucceive urvey 11 ), level of udertadig of what it aim to achieve are till relatively low. No-Ivetor' awaree ad udertadig of Ivetor Aware of Ivetor i People before the iterview 58 Not aware of Ivetor i People before the iterview 42 No. of Repodet 252 If aware of Ivetor i People: Udertad what Ivetor i People i about 34 Vaguely / partly udertad what Ivetor i People i about Source: Do't udertad what Ivetor i People i about 13 No. of Repodet 143 Survey of No-Ivetor, PACEC I term of poitioig ad promotig Ivetor i People ad it potetially wider role withi orgaiatio, Table 2.6 i more ecouragig tha Table 2.5, becaue it how that the No-Ivetor aware of Ivetor i People believe that there i a relatively wide rage of potetial beefit aociated with reachig the Stadard. The beefit omiated do ot feature 'hard' buie performace beefit promietly, but it i iteretig to ote that potetial wider beefit (e.g. improved exteral perceptio ad cutomer atifactio) rak highly, uggetig that although may No-Ivetor are uaware of Ivetor ad what it i about, amogt thoe that are aware there i a appreciatio of the potetial wider beefit of Ivetor, commeurate with the icreae i wider broad aim amogt recogied ad committed orgaiatio (ee Table 2.1). 11 See Skill Need I Britai Page 18

21 Ivolvemet with Ivetor i People Table 2.6 No-Ivetor' perceptio of the potetial beefit from achievig the Stadard, (% of No-Ivetor aware) More effective traiig ad developmet 31 Improved exteral perceptio of the orgaiatio 23 Improved cutomer atifactio 22 Improved recruitmet ad retetio of taff 21 Improved quality of product / ervice 19 More formal HR / peroel ytem 15 Improved buie growth or performace 14 More buie developmet opportuitie 5 Improved productivity 5 Other 9 No. of Repodet 149 Source: Survey of No-Ivetor, PACEC 2.6. Barrier to ivolvemet A Table 2.7 how, roughly oe i ix No-Ivetor aware of Ivetor i People aid that they had formally coidered puruig the Stadard 12, but early twice a may did ot kow whether they had coidered the iue or ot. Table 2.8 reveal that, amogt the majority who aid that they had ot formally coidered puruig Ivetor i People, the chief reao wa the belief that the compay / orgaiatio wa too mall ad / or lacked the reource. Of greater cocer perhap, a ubtatial miority idicated that they believed there would be o beefit. Thu although No-Ivetor eem to be aware of the potetially wide rage of beefit (ee 2.5.2), may are ot coviced eough to tralate thi ito behaviour. Table 2.7 No-Ivetor who have formally coidered puruig the Stadard, % (No-Ivetor aware of Ivetor i People) Ye, coidered puruig Ivetor i People 16 No, have ot coidered puruig Ivetor i People 55 Do't kow 29 No. of Repodet 148 Source: Survey of No-Ivetor, PACEC Table 2.8 Reao for ot coiderig Ivetor i People, % (No- 12 The Skill Need i Britai report howed the ame proportio. Page 19

22 Ivolvemet with Ivetor i People Ivetor aware) Compay / orgaiatio too mall / ot eough reource 49 Do't thik it ca be beeficial to u 24 No time / too time coumig 15 Not relevat to idutry 15 Already hold aother HR accreditatio 8 Fiacial or operatioal difficultie 6 Deciio carried out elewhere 4 Structural chage beig udertake i the orgaiatio 4 Orgaiatio brought up or merged 1 Other 20 Do't kow 2 No particular reao 2 No. of Repodet 84 Source: Survey of No-Ivetor, PACEC It wa alo foud from the No-Ivetor urveyed that: Amogt the relatively few orgaiatio that had formally coidered puruig Ivetor i People, about oe-third had take o tep toward commitmet, although a imilar proportio had met a TEC advior or coultat to dicu the poibility, ad the ame proportio agai had obtaied relevat literature. Roughly oe i te of the No-Ivetor that had formally coidered puruig the Stadard aid that they had previouly made a commitmet. The factor which militated mot trogly agait commitmet amogt thoe that had formally coidered the poibility were a lack of time ad cocer about the cot. Ucertaity or cepticim about beefit to be derived were alo relatively widepread; ad ome alo metioed lack of exteral advice ad lack of ufficiet udertadig or kowledge of huma reource maagemet. A quarter of the orgaiatio that had formally coidered puruig the Stadard i the pat aid that it wa very or quite likely that they would commit to Ivetor i People i the future, but the majority aid that it wa ot very likely or ot at all likely. Page 20

23 Ivolvemet with Ivetor i People Summary of key fidig Amogt both Recogied ad Committed Orgaiatio, the mai objective i puruig the Stadard were 'Efficiecy gai', 'Icreaed quality product ad ervice' ad 'Staff retetio ad eaier recruitmet' (Table 2.1). Compario with the fidig of previou reearch idicate that the objective i puruig Ivetor are wideig i.e Ivetor i People ha aumed a wider role withi orgaiatio i recet year. May Recogied ad Committed Orgaiatio idicated that they faced o particular barrier to the implemetatio of HR bet practice before their ivolvemet i Ivetor i People; ad that they already purued bet practice. The mot frequetly metioed barrier (lack of time) wa metioed by oly 6% of Recogied Orgaiatio ad 10% of Committed Orgaiatio (Table 2.2). A majority of both Recogied Orgaiatio ad Committed Orgaiatio received fiacial or i-kid upport from public ource to help them purue the Stadard. May orgaiatio uggeted that they would have purued the Stadard ayway without thi upport, but upport i importat to maller orgaiatio (Table 2.3 ad 2.4, Paragraph 2.4.3). Nearly half of the No-Ivetor urveyed were previouly uaware of Ivetor i People, ad oly oe fifth claimed to udertad what it i about (Table 2.5). Although No-Ivetor who are aware of Ivetor i People believe that there i a wide rage of beefit aociated with reachig the Stadard, few have formally coidered committig (Table 2.6 ad 2.7). The pricipal reao for ot committig wa the belief that the compay / orgaiatio wa too mall ad / or lacked the reource. A miority idicated believed there would be o beefit (Table 2.8). Amogt thoe who had coidered, but decided agait, committig to the Stadard, the mai cocer were lack of time ad cocer about the cot. Ucertaity or cepticim about beefit to be derived were alo relatively widepread (Paragraph 2.6.1). Page 21

24 3. Itermediate Effect of Ivetor i People 3.1. Itroductio Chapter 2 howed what objective Recogied ad Committed Orgaiatio had i puruig the Ivetor i People tadard. It wa how that thee were relatively wide compared to the objective of orgaiatio of a few year ago. Thi chapter tart by reportig the extet to which thee objective were, or have bee, atified (ad by implicatio, whether the wider objective of recet year have bee realied). It the examie whether, ad i what way, Recogied ad Committed Orgaiatio' huma reource pla, ytem, practice ad procee have bee affected. The durability ad additioality of effect, regarded a 'wider beefit' a part of thi reearch, are the coidered. Latly, it explore the impact of the Stadard o orgaiatio' cah expediture o, ad other reource iput to, HR developmet Achievemet of objective i participatig Table 3.1 reveal a iteretig cotrat betwee Recogied Orgaiatio ad Committed Orgaiatio i term of the extet to which they have achieved their objective i puruig the Ivetor i People Stadard. The majority amogt both group aid that they had achieved their objective to ome extet. However, wherea more tha five time a may Recogied Orgaiatio aid that they had achieved their objective to a great extet a aid they had ot achieved their objective at all, more of the Committed Orgaiatio aid they had ot achieved their objective at all (to date) tha aid they had achieved them to a great extet It i likely that the ituatio will chage amogt the Committed Orgaiatio urveyed a they get earer to reachig the Stadard. Noethele, it i poible that a igificat proportio will ever achieve their objective fully, epecially if (for the ort of reao to be examied i Chapter 7) they ceae to make progre, or make oly low progre, toward the Stadard. Thee fidig ugget either that the wider objective of the ort ought by orgaiatio take loger to accrue ad that they are more difficult to attai without puruig full accreditatio Page 22

25 Itermediate Effect of Ivetor i People Table 3.1 Extet to which orgaiatio have (to date) achieved their broad objective i puruig the Stadard, % Recogied Orgaiatio Committed Orgaiatio To a great extet To ome extet Not at all 7 25 No. of Repodet We ca be 95% certai that figure i bold are differet from thoe for Recogied Orgaiatio Source: Survey of Recogied Orgaiatio ad Committed Orgaiatio, PACEC Table 3.2 relate the extet to which the Recogied Orgaiatio ad Committed Orgaiatio combied have achieved their broad objective i puruig the Stadard to the particular objective they pecified (ee Table 2.1) 13. Almot perverely, it how that the objective mot frequetly pecified (i.e. Efficiecy gai) wa the leat likely to be achieved to a great extet, wherea the objective leat frequetly metioed (i.e. Chage i corporate culture) wa the mot likely to be achieved to a great extet. However, it i poibly the cae that 'harder' objective are rather more difficult to achieve tha 'ofter' objective, uch a cultural chage It may well alo be that a Ivetor i People ha become embedded withi orgaiatio that the wider impact have become apparet ad that thee have i tur come to be aticipated ad actively ought o the part of ew participat. Certaily, compario of the aticipated beefit that have bee realied betwee the curret ad 1995 urvey reveal a greater realiatio of wider beefit i the curret urvey. For example, over 90% of thoe aticipatig icreaed profitability thought that they had achieved thi at leat to ome extet - thi compare with the fidig of the 1995 urvey i which jut 43% of thoe aticipatig improved fiacial performace aid thi had bee realied. Table 3.2 Extet to which orgaiatio have achieved the 13 The table how combied reult for Recogied ad Committed Orgaiatio for the ake of brevity. However, a might be imagied o the bai of the fidig i Table 3.1, for ay particular objective cited, Recogied Orgaiatio were more likely tha Committed Orgaiatio to ay that the had achieved the objective to a great extet. Page 23

26 Itermediate Effect of Ivetor i People objective they tated, (% of Recogied ad Committed Orgaiatio combied - ee footote) of which, proportio ayig objective Proportio ha bee atified... citig... to a great... to ome... ot Objective: objective extet extet at all Efficiecy gai Icreae i quality of product / ervice Staff retetio ad eaier recruitmet Buie growth Icreae i profitability Chage i corporate culture All objective No. of Repodet 835 Source: Survey of Recogied Orgaiatio ad Committed Orgaiatio, PACEC Nearly two-third of the Recogied Orgaiatio urveyed (63%) aid that they had evaluated the impact that Ivetor i People ha had o the way i which they operated ad performed. However, eve durig the coure of face-to-face iterview relatively few of the Recogied Orgaiatio (i.e. fewer tha four i te) could decribe what the impact had bee. Noethele, ome of the impact o operatio ad performace reported were: "Staff turover dow / Improved taff atifactio" "Help with buie growth / tability" "Better iteral ad exteral commuicatio" "Improvemet i cutomer atifactio" "More buie developmet opportuitie" "Icreaed efficiecy" "Improved image" "More tructured approach to traiig ad developmet" "Improved product / ervice" All of the Recogied ad Committed Orgaiatio were the ivited to idicate the extet to which they had felt they had achieved each of a pecified et of poible effect of reachig or workig toward the Stadard. Their repoe are ummaried i Table 3.3 ad, ot uurpriigly, it how that the Recogied Orgaiatio were more likely tha the Committed Orgaiatio to ackowledge a great or fair effect i every cae. Table 3.3 Extet to which Ivetor i People ha affected Page 24

27 Itermediate Effect of Ivetor i People orgaiatio to date, % ayig they have bee affected i the way how to a great or fair extet Recogied Orgaiatio Committed Orgaiatio More effective traiig ad developmet Improved exteral perceptio of the orgaiatio Improved recruitmet ad retetio of taff Improved quality of product ad ervice More formal HR / peroel ytem Improved cutomer atifactio Improved productivity Improved buie growth ad performace Improved buie developmet opportuitie No. of Repodet We ca be 95% certai that figure i bold are differet from thoe for Recogied Orgaiatio Source: Survey of Recogied Orgaiatio ad Committed Orgaiatio, PACEC Iteretigly, there appear to be a trog relatiohip betwee orgaiatio' broad objective i puruig the Stadard (ee Table 2.1) ad the extet to which they had experieced the effect how i Table 3.3. Thu, the proportio of Recogied Orgaiatio ayig that the effect how i Table 3.3 had happeed to a great or fair extet wa alway larger amogt orgaiatio that pecified 'chage i corporate culture' a a broad objective i puruig the Stadard tha amogt orgaiatio pecifyig ay other broad objective. Preciely the oppoite wa true of orgaiatio that had pecified 'efficiecy gai' a a broad objective Ufortuately, however, thi fidig doe ot have a clear iterpretatio, although it will be recalled from Table 3.2 that 'chage i corporate culture' ad 'efficiecy gai' were at oppoite ed of the cale i term of the extet to which they had bee atified a broad objective. Thi might mea that atifactio of broad objective wa equated with the experiece of a wide rage of itermediate effect, wherea failure to atify broad objective wa equated with the abece of effect. Or it may be that ome broad objective may ot be aociated with uch itermediate effect. Oe would alo have to take ito accout the 'tartig poit' of orgaiatio puruig particular objective. Clearly, the relatiohip betwee caue ad effect here i difficult to dietagle Aother iteretig feature of Table 3.3 i that it trogly ugget that ome effect are felt earlier tha other alog the road to achievig the Stadard. Amogt the Recogied Orgaiatio the proportio of repodet ayig that they had bee affected to a great or fair extet did ot vary ubtatially accordig to type of effect. However, there wa more clear variatio accordig to type of effect amogt the Committed Orgaiatio (who committed to the Stadard at Page 25

28 Itermediate Effect of Ivetor i People differet date ad who are likely to have made differig progre). Thu, the Table ugget that more formal HR ad peroel ytem ad more effective traiig ad developmet are relatively early tage effect, wherea wider beefit uch a improved buie performace ad improved cliet atifactio come later Effect o Recogied Orgaiatio' HR maagemet ad practice Table 3.4 provide a epecially clear view of the added value aociated with Ivetor i People. The ecod colum of umber, for example, how that jut over half of the Recogied Orgaiatio urveyed had a writte HR or peroel pla i place before commitmet, but the revied it. The third colum how that early a quarter of Recogied Orgaiatio did ot previouly have a writte HR or peroel pla of ay kid before commitmet, but the itroduced oe The fial colum how that over half of the Recogied Orgaiatio have further developed their HR or peroel pla ice achievig the Stadard, idicatig that recogitio ha timulated ogoig chage withi orgaiatio, regarded a a 'wider beefit' of Ivetor i People for purpoe of the curret reearch. Overall, the table idicate that Ivetor i People ha a profoud acro-the-board impact o orgaiatio' HR pla, ytem ad procee. Appedix B alo how that micro- ad mall orgaiatio (i.e. with fewer tha 50 employee) were more likely tha medium ad large orgaiatio to ay that they did ot have HR pla, ytem ad procee i place before their ivolvemet with Ivetor i People, but that they itroduced them a a reult. Page 26

29 Itermediate Effect of Ivetor i People Table 3.4 Effect of Ivetor i People o HR pla, ytem ad procee, % (Recogied Orgaiatio oly, N=564) Before commitmet Further I place I place Not i place Not i place developed ad ot but but Not ice revied revied itroduced applicable recogitio Writte HR/peroel pla Formal traiig pla Sytem for idetifyig traiig eed Sytem for evaluatig traiig Commuicatig buie pla to employee Employee commuicatio proce or appraial ytem Bechmarkig with other orgaiatio Other Source: Survey of Recogied Orgaiatio, PACEC A might be expected i light of the fidig i Table 3.4, it wa alo foud that the barrier to further developmet of orgaiatio' HR pla, ytem ad procee pot-recogitio do ot eem to be epecially trog or widepread. Ideed, the majority of iterviewee aid that there were o barrier. However, 27% metioed lack of time a a barrier ad 17% metioed cot ad fiace more geerally A might alo have bee predicted, the large majority of Recogied Orgaiatio idicated that the amout of traiig ad developmet they udertook or provided had icreaed while they were workig toward the Stadard (Table 3.5), ad virtually oe idicated that it had decreaed. The table alo idicate that chage i the amout varied little accordig to type ad level of traiig ad developmet. Page 27

30 Itermediate Effect of Ivetor i People Table 3.5 Effect of workig toward the Stadard o amout of traiig ad developmet, % (Recogied Orgaiatio oly, N=554) Amout of: Icreaed ubtatially Icreaed lightly No chage Decreaed lightly Decreaed ubtatially Traiig & developmet overall Maagemet traiig & developmet No-mgt. traiig & developmet O-the-job traiig & developmet Off-the-job traiig & developmet Source: Survey of Recogied Orgaiatio, PACEC Table 3.6 alo repreet a key fidig with repect to the wider role ad beefit of Ivetor i People, i that it idicate that the effect ad impact o Recogied Orgaiatio, a outlied earlier i thi chapter, have ofte accumulated ad have rarely faded. Table 3.6 Chage i effect ad impact ice recogitio, % of Recogied Orgaiatio ackowledgig effect ad impact Effect ad impact have accumulated 39 Effect ad impact have tayed the ame 46 Effect ad impact have faded 5 Do't kow / ot ure 10 No. of Repodet 556 Source: Survey of Recogied Orgaiatio, PACEC 3.4. Effect o Committed Orgaiatio' HR maagemet ad practice Table 3.7 how the effect of Ivetor i People o Committed Orgaiatio' HR pla, ytem ad procee to date. The table i directly comparable to Table 3.4, ad the compario how that there are few igificat differece betwee the Committed Orgaiatio ad Recogied Orgaiatio i term of the frequecy with which they reported effect. Thi ted to cofirm the earlier cocluio (ee paragraph 3.2.6) that impact o orgaiatio' ytem ad activitie aociated with Ivetor i People ted to be felt relatively oo after commitmet. I cotrat with the fidig for Recogied Orgaiatio, the effect of ivolvemet i Ivetor i People o Committed Orgaiatio' HR pla, ytem ad procee did ot appear to be clearly ize-related. Page 28