Interview with Jill Shedden, people director at Centrica Energy
David Woods, May 17, 2011
Jill Shedden has been appointed group HR director for Centrica. She takes on her new role in July, but HR magazine caught up with Shedden in December.
About now, 250 miles away in the stormy North Sea, a brand new gas platform called F3-FA will start drilling for gas to start supplying heating to people's homes as early as next spring. The £200-million, 9,000-tonne rig standing 130m off the seabed looks just like any other, but the Centrica Energy installation is something of an innovation. It's the world's first reusable rig that can be floated to wherever it is needed and is the firm's solution to finding and extracting much smaller pockets of energy over which it would hitherto have been too expensive to build a permanent platform. Significantly, whereas these might require 100 people to man in the 1970s or 80s, this only needs seven or eight.
These are the sorts of different, exciting innovations - with resultant people issues - that Jill Shedden, Centrica Energy's people director, is charged with. As the UK's energy sources dwindle, and more cunning solutions to extract them are needed, no two days are ever the same for Shedden. As we were going to press, the main Centrica Group announced it was to start working with Thames Water to feed renewable gas from sewage onto the national grid. This is on top of the five wind farms in the UK that Centrica Energy operates, the eight gas fire stations it powers, and its interests in nuclear.
"We generated 17,497GWh of energy last year," says Shedden. "Our vision is to secure UK energy needs, adapt to the changing nature of the market and push towards green energy in the hope of providing power for the next 100 years. The main challenge for our staff is what to do when fuels become less easily available."
Although Centrica Energy is part of the Centrica Group (with a reported operating profit of £485 million to June this year) and sister company to British Gas, it has a much smaller core of 2,000 employees. That said, these people could be working on oilrigs, gas platforms, offices or power stations - mostly in technical roles. It's a tough HR brief that concentrates the mind. Shedden is adamant: this is a sector where not only training and development but also constant staff communication cannot be trimmed.
"We are a long-term business and the underlying business has been strong when the economy was not looking too rosy. But we are very clear about what we spend money on. We didn't stop training last year, but we made it more focused." This has not just covered technical skills. The company also invested in talking to staff about the general changes in the energy market and how they fit into this. They included staff lunch and learn sessions, while a training 'tunnel' was set up in the head office that staff could walk through to learn about the importance of developing the nuclear energy sector.
Communicating corporate social responsibility's place at the heart of the energy firm is also hugely important to Centrica Energy. It has signs all over the workplace reminding readers to close doors, reserve heat and save energy so no staff member or visitor can miss them.
Shedden doesn't want to employ people who might despair at the challenge of providing a century's worth of energy in a world where the lights are dimming over the fossil fuels industry. "We want to create an oil and gas company different from the others, so we can attract people who want to be in a high-performing culture of innovation," she adds. "In short, we want capable staff capturing innovation with a challenging agenda."
Shedden is under no illusions about how HR works in the business. "I report directly to my managing director, Mark Hanafin, with a dotted line to group HR director Anne Minto," she says. "Some HR directors think it is outrageous when HR is not on the board but I think it is more important to have a relationship with your MD so you can deliver good HR." This relationship, she explains, leaves her able to concentrate on 100% HR issues. She says: "My HR role is fundamental because the business needs constant alignment to a people philosophy. Having a strategy behind this is fundamental," she adds.
Much of this strategy has been formulated by years within the company that is now Centrica. "I started as a graduate trainee at British Gas when it was one big energy company and joined Centrica post de-merger. As people director for British Gas Business, my role was to put people at the centre of the company and that was eight years ago. All the textbooks were talking about it, but it still took a bit of courage. Even back then, the aim was to engage our people and develop their relationships with customers. We showed them the vision for the business and relentlessly communicated and demonstrated this to them. Through this I believe we doubled our profit twofold."
Shedden subsequently transferred to British Gas Residential, taking with her the people-centric model. This organisation had issues around systems and billing and, according to Shedden, "they wanted technology but didn't think they needed people. My HR department had to completely change the company philosophy. By listening to what we said, people became proud to work for an organisation where previously they had been ashamed to work. From a recruitment point of view, people want to join a business that is buzzing, not one that is being battered by the press. We helped change this."
This past year has given Shedden the opportunity to put her experience into practice once more. In 2009 the company carried struck a deal with rival provider EDF to acquire a 20% stake in nuclear power organisation British Energy, which operates 15 nuclear reactors across eight UK sites. It also acquired Aberdeen-based North Sea gas producer Venture Production in a hostile takeover.
"We had redundancies from the acquisition because we needed to have a base in Aberdeen and although 12 staff were available to go there and relocate their families, 20 were not able to make the move to Scotland, so they were given voluntary redundancy," she explains.
This is where her staff communications experience really helped. She adds: "We wanted to make it clear to staff we saw this as a merger. This was our big message. We said to them: 'Take 100 days to think about this and during that time we will answer all your questions'."
The company brought together focus groups from both companies to have as much face-to-face passing of information as possible. "We wanted to prove we were not a 'faceless FTSE', so communication with employees was vital," says Shedden. "I just wanted them to know what was happening. We launched a part of our intranet site called 'The Bridge', where staff could ask questions and we tried to have monthly, face-to-face meetings with them."
Since the acquisition, Shedden and her team have been working on a cultural transformation project called the 'Centrica Energy Way'. Put simply, this focuses on three points: high performance, pioneering spirit and safety.
This is how she hopes staff will describe to other people the company culture and what it means to work there and as a result the vision is communicated vigorously.
The 'Centrica Energy Way' has been tailored to the specific needs of the business. High performance and a pioneering spirit reflect the company's move to nurture a culture of innovation in a challenging and fast-changing energy environment. And while health and safety is a top concern in most organisations, with Centrica Energy operating on North Sea platforms and power stations, safety has to be paramount - especially given the press coverage surrounding the recent accident on BP's Macondo platform in the Gulf of Mexico and, closer to home, the Piper Alpha fire off the coast of Aberdeen in 1988.
Going forward, the challenges of a sustainable, innovative, pioneering and high-performance culture continue, but Shedden seems confident the "good HR" she has delivered over the years will continue. "We have performance management in place to nurture high-performance teams and we will encourage our managers to give good feedback as part of this. We have a focus on recruiting the right people in an innovative way - we wouldn't rule anyone out for an interview."
And she ruthlessly advocates the importance of staff communications: "The more diverse your sites are, the more important it is to find the time to see people. So we make a point of visiting our power stations," she says.
Centrica Energy is a weird fish in that it is using funds from its current business to grow in an industry that will, before we know it, be plunged into uncertainty. But surely the long-term thinking on the part of its people director is something her peers in other industries should be looking at with envy. In this age of austerity, who knows what lies around the corner after all?