How many companies are there in the FTSE100?
Daft question right?
So how about this one….what percentage of UK companies do they constitute?
The answer is less than half of one percent. And even if you take out sole traders the number doesn’t quite reach 1%.
SME’s employ 13.6m people within the UK and firms employing less than 100 people account for 65% of new jobs created each year. If you include the companies sub FTSE100 but not classified as SME you get somewhere near to 90%.
So why is it that we seem so fixated by a limited number of companies explaining the “right” way to do HR and people management? If you look at any conference list or journal article you will invariably see the usual suspects arise.
Now I should add that I don’t have anything against these companies or the people who speak per se. But I don’t think that the constant focus on a select group does anything to improve the collective knowledge of a profession or helps creativity, entrepreneurialism or innovation.
When I was learning my trade it was Marks and Spencer’s that were being hailed as the people to aspire to. That was in the mid 90’s and of course not many years later they were experiencing the worst, self-imposed, decline in their history. Likewise not so long ago Royal Bank of Scotland were being hailed and recognized for their success in people management – I don’t need to add much more to that. And one of the latest entrants to the scene seems to be Nokia, which I find curious given their current “burning platform”.
So given that there s why does this happen? Well I think there are a couple of factors at play,
– We think that big is beautiful and assume that because an organisation is large it is good. The only reason a company is in the FTSE100 is because of its financial muscle, not its intelligence
– Once you’re on the circuit, you’re on the circuit – easy for lazy conference organisers and big brands require no explanation (is there anyone in American HR who hasn’t been made aware of Zappos?)
I’m not saying that interesting ideas can’t come from the big boys (although I do think size inhibits not enhances innovation) but by the law of averages there must be a whole host of other people out their doing good things. If we’re really interested in driving innovation and creativity in the profession then we need to hear from companies and HR Directors who are doing truly intelligent people interventions, ones that are culturally sensitive, business focussed and have demonstrable value (no this isn’t a pitch for business!). And from the feedback that I heard recently, I’m not alone.
Conference organisers/journalists – take note.
change-effect 
My working life has so far encompassed 5 years at one major high street bank and 2 years working for small business’s. No more then 4 FTE – so far the experience has been mixed.
The multi-national I worked for treated (and to my knowledge still does) everyone like crap. Ironic seeing as at the time they were aspiring to be ‘the best place to work.’
Several young managers (early to mid-20s) left at the same time as me, this was a mixture of too much too young and categorical failings in the line management’s abilities to support. Needless to say the cases of sign off’s due to depression and stress were high.
My conclusion to this experience – we are nothing but numbers, cannon fodder, there is no interest in the well-being of staff because anyone can be replaced and there is a line of younger more naive fresh blood to replace you. There was also ‘the London issue’ being down in the South West – London is a far away and the feeling within the ranks was often of dictatorship from the ivory tower.
A bad final 6 months that tarnished a otherwise enjoyable 5 years and would make me highly unlikely to work for a multi-national again, despite the benefits these huge institutions offer.
Sadly I think that is the experience of a lot of people in companies. Hopefully their HR people aren’t bold enough to be standing up in conferences talking about how wonderful they are.
I wouldn’t be surprised if they do, never underestimate the arrogance of big companies (large banks especially).
As someone who works sub 100 the things that always strike me are:
1. How often “their” solutions don’t fit in organizations without their scale or resources
2. How often what is presented is only true for those presenting it and a small population at the core of whatever initiative…. often “amazing programme no.146” hasn’t landed with their employees
Completely on point number 2 Rob (although I don’t disagree with 1 either). And often the programme has only been in place for a year…so how can hat really be shown to be successful?
Whilst i agree with the sentiment, these companies:
a) Have done something right to get to become big
b) Have the biggest headaches in sheer numbers
c) SMEs tend to have owner managers rather than HR people, and are genrally too busy to speak.
What *would* be good is some shared experience from the people who founded those SMEs and how they managed the people aspects of their businesses while they were growing. But HR might recoil in horror at some of what they have to say!
Claire, thanks for taking the time to comment. I guess RBS were in the FTSE100. So you could argue that they did something right…and the right things they did then turned out to be very wrong.
On the issue of size, that can be true but having worked for large retail businesses and small creative companies I would say the headaches are different but one is not bigger than the other.
I guess my overall point wasn’t just to focus on SMEs but ALL companies outside of the FTSE. Which is most of the companies within the UK.
And I think recoiling in horror would be a good thing too – might blow away some of the cobwebs!
I know when i’m working on PR campaigns, the traditional media, they usually want a case study from a big company.
Could you redress the balance by creating a place (a blog?a part of this blog?) for those alternative case studies to go?
Great idea Claire…it would be a really good thing for either XpertHR or the CIPD or someone to pick up. And I completely get the point about PR, because big brands need no explanation.
Thanks again, I’ll contact CIPD and see what they think.
Hi Neil, great post as ever. I think a part of the problem is that larger companies have the resources to bring in consultants, adopt new models and then draw up case studies to present at conferences. Smaller companies are just getting on with it. So, while conference organisers should be looking outside of the bigger organisations so HR pros in smaller companie should also share what they are doing – and have a safe environment to do so. I think less formal conferences are a good place for this. And some of this does take place in networking forums up and down the country.
Great point Martin. Someone actually mentioned that they spoke to one of the big consulting firms and said, “Why do you always do the case studies on the same people?” the response was, “Because they ask us to”.
Neil, great post, my first one of yours so I will be sure to subscribe.
As an SME founder and owner my view is that corporate organisations can learn a lot from how how SMEs lead and manage their people. The truth is we have to not only believe that people are our biggest asset we have to live it, as the consequences are dire if you don’t, we don’t have a choice. For the average manager/leader in a FTSE100 corporate the consequences of poor management or leadership just don’t exist. Great businesses have motivated and happy people working in them, this is a question of leadership not HR. HR are not required to create a high performing, happy workforce, great leadership is, simple.
I am happy to talk about how we have grown a very successful business without HR, however it’s no rocket science really. Treat people the way you would want to be treated, honestly, fairly and transparently. Keep communication simple and frequent. Make rewards visible and personal. Be clear on the values your business works to, make decisions in line with the values and be zero tolerant of behaviour that differs from the values. The great thing about an SME in difference to a FTSE100 company is that your control of these is absolute, there is no dilution, in this regard we are lucky.
That’s my piece, again great post.
Thanks Roger and a superb comment. I think this really emphasises that the case studies are often about great process rather than great success or leadership.