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Interview

Jill Shedden
HR Director
Centrica

In her 20 years tenure at the centre of Centica’s HR, Jill Shedden has been responsible for forging the energy giant’s HR culture. There are fundamental differences between Centrica today and British Gas as was, and so it is no surprise to learn that for Jill, the years have flown by.

Jill, it is rare these days for somebody to stay with the same organisation for their entire career.  

Well, I can honestly say that I’ve never been tempted to go anywhere else. I started with British Gas just over 20 years ago as a graduate trainee in marketing. At that age, I really needed to gain a deeper understanding of how businesses worked and how they operated, and I quickly got that in British Gas. My two years on the graduate programme gave me the opportunity to think about where I really wanted to take my career and I quickly realised that the thing that really fascinated me was people and what made them tick, so I made the move into mainstream HR. From that point I became more involved in strategic HR and working with leadership teams.

One of the many things that have made me want to stay at Centrica is that the passion I have for people is very much mirrored throughout the organisation, and I think that’s been a key driver of our company’s success. My first HR director role was in British Gas Business, where we weren’t afraid to try new ideas to motivate and engage our teams. Some of the things we implemented were considered a bit whacky by many corporations at the time. We took some big risks with flexible working, we gave our front line people the autonomy to manage their own time, and got rid of dress codes. It seems obvious now, but it was cutting edge HR at the time, and it achieved some phenomenal results: employee turnover dropped significantly and profits doubled. That freedom to try new ideas is something I have been encouraged to bring to all of the Centrica businesses I’ve been part of since, and that’s a big reason for my having stayed.

How have you dealt with change, for example in technology and communication, in your roles?  

I moved from British Gas Business to British Gas Energy, which supplied 16 million customers with gas and electricity. At that time we were hitting some problems, we had just set up a new IT system and we were struggling with bill accuracy. Naturally, customers were very upset and, inside British Gas, people were taking the heat from a processing system that was just not working. I joined at the same time as the new MD, Phil Bentley, and whilst we were challenged by the technology, and were under intense pressure, we worked on making sure that the people on the frontline, the people talking to our customers, were fully informed and supported. We gave all of our people access to email, which they had never had, and set up a blog from Phil, giving everyone the ability to connect with him directly.

Twenty years ago, HR was very different, where did you take your inspiration of how to make these massive, cultural changes through HR?  

I went into HR because I knew it could be a real catalyst for change. I’ve always found that people in HR want to make change happen, but what wasn’t evident 20 years ago was an acceptance by leadership teams thatHR professionals had the skills to make change happen. Over the years we’ve worked very hard as a profession at having conversations that champion the belief that it is people, and an unerring focus on them, that makes the difference. When I first started with British Gas Business, I was the only one in the room talking about people and engagement. Five years later, I found that I couldn’t get a word in edgeways; everyone wanted to talk about engagement. For me that was a huge sign that we had started to change the culture of the business.

Did you see that HR was getting more responsibility, whether it liked it or not?  

We have certainly built a great deal of trust with business leaders to ensure we attract the right capability to the business, and that the people with that capability are led, developed, rewarded and motivated to perform. I wouldn’t encourage ‘scope creep’ too much in any team, as responsibilities can become blurred and that’s when someone drops the ball. Our role from this point of view is to help the business recruit and retain the right people in the right roles with the right responsibilities.

Changing cultures and modernisation must be incredibly hard to achieve in an organisation such as Centrica?  

I think Centrica often gets lumped into the ‘utility’ bucket, and people assume it’s slow to move and old fashioned as a result. But the reality couldn’t be more different. People have said walking into British Gas’ offices is like walking into Google, and one of the things we talk about in

Energy is our ‘pioneering spirit’ – the fact that we’re constantly looking for a better way of doing things, and everyone is encouraged to seize responsibility for issues.

So, we have built a culture that is able to change quickly and continue to deliver strong results. But we’ve only been able to build that culture because of our focus on people as the drivers of business success; we’ve always involved people in the creation of a strong culture in each business unit, and the fact that they’ve been involved in creating that culture means that people feel that it’s far more applicable and significant to them than if it had been created by a bunch of senior managers in a room and then ‘rolled out’.

What were the key indicators throughout Centrica’s history that demonstrated that momentum was being achieved?  

Well, the business was privatised in 1997 and we’ve led some significant organisational changes since then; the biggest was probably in British Gas in 2007 when the business was suffering its biggest customer service issues as a result of the new IT system. We needed to completely reorganise ourselves and change the culture to one where our people were at the heart of everything we did as a leadership team, and our customers were at the heart of everything we did as a business.

After a year, we saw a levelling off of customers,who had been leaving at the rate of one every 30 seconds. Then we saw employee engagement start to increase, and with it customer satisfaction, customer numbers and business success. Our own people then voted British Gas the 17th Best Big Company to Work for in the UK in 2009 in the Sunday Times, and the business has gone from strength to strength ever since. We’re seeing similar successes in our other businesses and, under Sam Laidlaw’s leadership, Centrica plc has become the 25th biggest company in the UK with a vital role to play in the future security of the country’s energy supply.

New broom sweeping clean… there are significant risks with associated with this scale and speed of change.  

There are risks, but I believe you can mitigate them with a strong set of principles that are based around people, value, strategy and customers. There can be a danger that you approach a change programme as a ‘clean slate’ where everything needs to change; but that can imply that everything that has gone before is no longer relevant. We don’t just focus on the exciting plans we have for the future; we focus a lot on our history, which actually stretches back over 200 years, where we’ve come from, and the people who have made us what we are today.

Change is the ultimate motivator, but how far ahead can you plan for the resourcing needs of organisation?  

We employ over 40,000 people across the world and we have to remember that the external environment is constantly changing, that external changes affect current and potential employees, and that we have to be proactive in responding as a result. We regularly take part in strategic scenario planning internally and with external organisations to look at the future of the industry and the skills we’re likely to need in ten years time. The key is then linking in with schools and Universities to engage students of all levels and abilities in the careers we’re able to offer and the subjects they’ll need to study. We have very strong summer internship programmes and one of the best graduate schemes in the country and we have a growing engineering apprenticeship programme, all of which allows us to continually invest in a pipeline of talented, passionate people. We’re also constantly refreshing our approach to Learning and Development to ensure our own employees have the skills they – and we – will need in the future.

What is the future of energy provision for Centrica… there must be a lot of pressure to get that vision right?  

I actually believe we got our vision right some time ago, and we’ve seen strong business performance as a result. Our vision is to be the leading integrated energy company in our chosen markets, and that means covering the entire energy chain in the UK and North America. In terms of the future, the strategy that underpins our approach is about providing energy for a low carbon world, and this is where it gets particularly exciting. In British Gas, that means helping customers to save energy through efficiency, smart grigs, micro generation and other new technologies. As a company, we’re planning to invest £15bn in the UK’s energy needs by 2020, and by that time we’ll see a broad energy mix including further wind farms, nuclear and potentially other technologies.

We also have a successful and growing oil and gas business that began when we discovered the huge gas reserves in the East Irish Sea in the 1970s. Now North Sea reserves are declining, and many gas fields are ‘orphaned’, meaning the remaining oil and gas in them can only be reached with special skills and equipment. This makes orphaned elds very difficult to develop and, with current technology, many are no longer economically viable. But we’re incredibly proud of our technical expertise, and one of the many results of the pioneering spirit I mentioned earlier is the F3FA platform, which is the largest self installing platform ever built. This platform can be reused in elds across the North Sea, which means the economics add up and we can secure the gas our British Gas customers need to provide heat and light for their homes, offices and factories.

How does Centrica position itself as an attractive employer - for example, how important is its environmentally-aware credentials, as a prominent part of the employer brand appeal?  

I don’t think you can underestimate how important the low carbon agenda is to our business, to our country and to the world, and engaging all of our stakeholders in the commitment needed to build a low carbon world is a big part of what we do. Our younger employees, particularly graduates and summer placement students, tend to be particularly interested in low carbon energy sources, such as nuclear and wind power, but we’ve actually got really good ‘green engagement’ across the business.

Other than a focus on a low carbon world, we find that people are attracted to Centrica because of the variety of roles available to them in different businesses in different countries and,from an engineering point of view, and by the way we both look for and develop our people. Not only do those things help us attract the best, they also mean many people stay with Centrica for their whole career – including me!

How do you believe the recession has affected the jobs market?  

I think that the recession has made people realise what’s important to them; having a job with a future has become increasingly important, whereas people tended to move between jobs before the recession, looking for the best-paid. I also believe that people actually want to feel some connection with the organisation, and that organisations need to feel connected with their employees. That might not have changed dramatically with the recession, but I do think it has become more important.

There’s a wide range of job types within Centrica,is it difficult to hit the right balance in providing what employees need and expect from the organisation as an employer?  

It is a major challenge, particularly from a communications point of view. One of the things I’ve learnt is that it’s difficult to reach 30,000 people with every message. Individuals need to feel that the messages we’re communicating are relevant to them and that, even though we’re a big company, everyone is as important as one another. When I worked in British Gas Energy, we broke the business up into three parts which we called the P&L businesses, all of which had their own identity. Everyone in each of the P&Ls understood their own customers’ needs and how their role was important to the business overall. The glue that still holds it all together is the feeling that every job is important for the overall business, from gas rigs to customer services desks. The separation is physical, but the connectivity is incredibly strong.

How does talent spotting, tracking and development work in such a huge and dispersed organisation?  

Over the past five years we’ve become fairly sophisticated in our approach to talent and development. We now have talent boards at every level of the business, and we discuss individuals’ leadership potential in the various groups around the organisation. So, we’re good at identifying and tracking talent, but the next stage for me is to focus on mobility – helping our talented colleagues to experience new challenges and build a broader skills set through secondments, placements and projects. Looking ahead ten years, we won’t just be looking for people with excellent technical knowledge, we’ll also be looking for people with vision, passion and a broad range of different experiences.

How do you keep your HR grip on the tiller, you could easily be blown off course?  

I think the greatest danger of being blown off course is when HR is not aligned to the business strategy. I’ve seen that happen a few times, and it means that not only do you not have your hand on the tiller, it means you’re actually in a different boat going in a completely different direction. Our role is to enable people to deliver value, and we do that by executing a robust HR strategy that is completely aligned with the business’ strategy and goals.

I’ve been lucky enough to be part of really high performing HR teams, which are properly organised to support the business, whose HR business partners are trusted advisors and members of business unit leadership teams, and whose HR director is an integral part of the executive decision making process. It’s very difficult to be blown off course when you’ve achieved a strong level of support and trust because, once you have that, HR is no longer seen as a support function, but as critical to business success.

Moving on to pensions, what are you putting in place and what are your plans for the future?  

Something like 40 percent of our new joiners choose not to join our pension scheme and those who choose not to join tend to be at a certain stage of life where retirement seems a long way off. I’m proud of the overall benefits package we’re able to offer but, whilst I am keen to communicate the benefits of our pension scheme, I don’t want to end up in a loop of constantly asking people to enrol, because it could seem a bit paternalistic. I’m a great believer that part of good leadership is about presenting people with options, and allowing them to make their own decisions.

Work/life balance always seems to rate high on employee wish lists, what’s your view on flexible working?  

I know it’s a bit of a HR cliché, but people are, unequivocally, the most important part of our business. So HR teams need to ask themselves: ‘how do we make sure people enjoy coming to work, that they’re able to manage their lives and able deliver what the business needs’? We’ve offered hot-desking, home working, and part-time job shares for a number of years but, although this is the norm for us, the amount of legislation around flexible working could be overwhelming for smaller businesses. We’ve worked hard to get the balance right for flexi-working and, for a large organisation like ours, I think there has to be mutual honesty and respect for it to work. We’re fortunate that the vast majority of people want to come to work and they want to do a great job, so flexible working tends to work well at Centrica.

Do you think HR is changing again, in the way that it operates?  

I think the pressure on HR is much greater than it has ever been, which makes this an exciting time to be an HR director. But I would say that HR is evolving, rather than changing, in an unexpected way. For me, it’s always been about demonstrating that HR creates value, drives strategy and can transform an organisation, and I think we’ve been successful as a profession in helping our stakeholders understand that. But with success usually comes further expectation, and that expectation increasingly requires HR teams to have a broader skill set, ranging from operational HR to strategy, to communications and engagement.

At a senior level, HR people also need to demonstrate strong commercial skills and business knowledge to succeed and, although I think this is absolutely right and can only be a good thing for our role, it will take a lot of hard work and dedication from HR professionals. I think the most positive change is away from a business expectation, that HR is there to manage payroll and get them out of difficult situations, and towards an exceptional focus on putting people at the heart of every successful organisation.

Are you surprised you stayed for so long?  

I remember sitting with a colleague in my first few weeks, who was leaving to work for American Express. She said she’d been here for ten years, and I can still remember thinking ‘there is no way I would stay anywhere for ten years – I’m going to be here for two years then move on.’ That was twenty years ago and I’m still thoroughly enjoying my time at Centrica now! I wouldn’t recommend staying in many organisations for twenty years, but Centrica has consistently provided me with new opportunities and challenges, I have changed my role dramatically since I started, and I have worked with some of the most inspiring leaders and talented individuals that I could have hoped to meet. So, looking back, I guess I am a little surprised; but I don’t regret it one bit.