Every HRD probably has their own version of HR utopia – how they’d set things up in the perfect world. But Alastair Gill’s, giffgaff’s people partner (and de facto HRD, he doesn’t care much about titles), is perhaps more radical than most.
When HR magazine visits him at giffgaff HQ in Uxbridge he muses that he’d “love to be in an environment where we had no contracts, just trust”.
But once you learn a bit more about the firm’s model and ethos this seemingly out-there ambition starts to make more sense.
Today giffgaff is a £407 million business with 250 staff. But it started life from humble beginnings in 2009 when its founder, former director of innovation at O2 and the brains behind the ‘he waits’ Guinness ad, Gav Thompson had a lightbulb moment.
“In the middle of the night he woke up and couldn’t stop thinking about a part on his motorbike he needed. So he put it to one of those local forums; he didn’t expect a reply,” relates Gill.
“But someone from another country said ‘I know exactly what it is, this is what you need to do’. He thought ‘if I’d spoken to BMW they wouldn’t do that’. So he suddenly realised that loyal customers are the best customer service. He started to think about the power of the internet… He thought ‘what if there are no call centres and the community answered everyone’s problems?’”
And thus giffgaff – which takes its name from the old Gaelic word for mutual giving – was born.
It was formed, Gill explains, very much in response to a shared frustration among its founders with how customers were being treated by mobile phone companies.
“The relationship between customers and corporates was diabolical,” says Gill. “You’d sign up to a 24-month phone contract and no-one would call you for 23 months; no-one would answer the phone. If your phone was broken you’d be overcharged or directed to an offshore call centre. Then one month before you were due an upgrade they were all over you like a rash.
“Customers were just sold to, and marketed to, and spun to, and told ‘you should accept this’. Mobile phone companies and banks were probably the worst.
“That was the same with jobs really,” he adds. “You signed up for a job for life; the implication was you were lucky to have one.”
So giffgaff was founded around the principles of ‘mutual, fair and simple’. Its target demographic is Millennials, it doesn’t have call centres, and beyond its SIM cards now being sold in some chains such as Tesco, Poundland and WHSmith has no retail footprint.
A system of ‘payback’ is central to its model. This was introduced in 2010 to incentivise members to troubleshoot issues on giffgaff’s community forum and to encourage new members to join, with payback distributed twice a year in June and December. Members choose whether to receive this in cash, SIM credit or to give it to charity, and the number of points accrued hinges on the number of members recruited and the popularity and impact of forum responses.
In 2018 payback reached £1.3 million, with many making decent money from the system. The most notable example is Jieping Lin who earned £160,000 in one year by hosting his own webpage, set up by giffgaff, through which he acquired new members.
But most members’ involvement is more low key, says Gill, who insists ‘working’ with giffgaff in this way is a far cry from the exploitative quasi-employment face of gigging.
“You do get challenged by people saying ‘are these people not effectively workers for you? They don’t earn a huge amount of money compared to what the company makes…’ But no-one’s ever said ‘you have to do stuff or do it in a certain way’. And when you’re young, at university or college perhaps, some of this stuff is quite entrepreneurial.”
Gill adds that the company does on occasion give particularly keen members formal jobs: “The guy who built our Windows app was a community member. Someone in the community said ‘I can build that for you’. He said ‘I’ll do it in my spare time…’ We said ‘well do you want a job?’
“We do have community educators – people who sort of work as giffgaff employees who sit in the community and start conversations, or start photography competitions for example and educate people on how to respond,” he adds.
But none of this would work, even with the payback system, if people weren’t fans of the brand says Gill. “You can only create a community if people love the product. A lot of companies now struggle to create that around their brand. So it’s tapping into the loyalty of brand advocates, making people feel part of something.”
The same principles very much apply to giffgaff employees – hence why Gill dreams, in his more fantastical moments, of a world with no employment contracts. His own lightbulb moment around the employer/employee psychological contract, and mutuality, came when he was working in local council HR.
“I started reading psychology books and about HR at Netflix,” reports Gill. “So I started thinking about better ways, looking at the data… But everyone just wanted to mitigate tribunal fees and no-one wanted to build and understand how HR could get a seat at the table.”
The interview at giffgaff, in 2014, couldn’t have come at a better time. “The CEO and CMO interviewed me. The CMO knew that, in the same way that you engage customers, there was something about mutuality and doing the right thing [by staff],” says Gill. “But they’d never written it down… they’d got to the point where there was attrition; there was still only 70 of them but they weren’t round a table any more understanding each other.”
It’s at this stage of a company’s evolution that Gill’s vision of a world with no contracts falls down a little, he admits: “Maybe [that wouldn’t work] in a business that’s scaling and getting bigger, because sometimes you will hire mavericks who don’t behave in the right way…”
Similarly with the recruitment process: “When you’re small you hire for cultural fit because if you’re trying to convince everyone to sail across the ocean they have to believe in what you’re trying to do. But when you get bigger, if you’re just bringing in people who think like you there’s potential for bias and missed opportunity. So you start thinking: do we have to agree on the same things? If there’s passion about what you do that transcends cultural fit.”
So some formal process is necessary. But it has to be just the right amount – as evidenced in Gill’s approach to working hours and mandated time in the office. “Don’t be worried about how often people ring in sick. If that’s starting to affect performance then be worried,” Gill muses.
“Because your manager’s never really going to understand your childcare requirements, your adult social care requirements, that you’ve got to feed the cat or walk the dog… Either they’ve got to understand that, or go ‘here’s what we need you to do, here’s when we’re going to catch up on a weekly basis, let’s find out what works for us two’.”
If you want someone in the office, particularly at a meeting, in Gill’s book you’ve got to inspire them to attend. “People who hold meetings have to say ‘how do I convince people?’” he says. “I don’t just put something in your diary. Otherwise if that’s in nine other people’s diaries that’s 10 hours of work. If I want to do that it has to be bloody good.”
On the topic of trust versus structure – of carrot versus stick – giffgaff enjoys the perhaps enviable position of defaulting to parent company O2 on more formal matters (grievances for example), leaving Gill to oversee such areas as culture, engagement and fostering creativity.
It’s a splitting out of operational and strategic HR that many larger firms could learn from, he feels: “I can’t have everyone’s ear in the business and then do a compromise agreement, and then be directly responsible for their pay. Otherwise if I’d built up a relationship with you and wanted your trust and feedback but I also influenced your pay, you’d think ‘well I’ll just tell him exactly what he wants to hear’.”
A key issue giffgaff sought feedback on recently was the design of the new Uxbridge office. While on first glance the space might contain the same trendy trappings as other tech firms, the whole point of enlisting employees’ input was to make it function in a more profound way, says Gill.
“The perks are just like the marketing campaign to attract someone in,” he says. “But there’s logic and science to collaborative- and then focused-working spaces, and to having a pool table. Because it’s about serendipitous interaction. If you can get a marketer playing pool with a developer that’s probably killed about 10 meetings.”
But such an environment, and the giffgaff way in general, won’t work for everyone stresses Gill. It’s about working out what you want to achieve: “If you want the outcome to be creativity and innovation you have to think about the environment. If you want productivity that’s a different beast, because creativity isn’t productivity. With creativity there’s a lot of waste, there’s a lot of faffing.”
Which doesn’t mean layers of employees on every team, however. Giffgaff does what it does so well because it avoids hierarchy and bureaucracy, explains Gill (something that applies very much to his own HR function of one).
“We’ve had 260 people before but actually it was harder to manage, harder to make sure everyone knows what the strategy is… We would rather have less people knowing exactly what they’re doing than more people sort of knowing.”
The company is highly mindful of not depending on discretionary effort to the point of burning people out though, caveats Gill: “If you’re a business that wants people to have meaningful work, the downside is that unless you’ve got something else that forces you to switch off – kids, knitting, hockey – you’ll obsess.”
Which is where, again, the flexibility and ‘perks’ on offer hopefully come in. These include a mindfulness programme kicked off before Christmas, regular talks from speakers ranging from nutritionists to business minds such as Twitter’s Bruce Daisley, yoga, running clubs… all designed to give employees perspective and show them the importance of passion for things outside of work.
“A lot of companies say ‘that wouldn’t work for us’. And that’s fine,” Gill reiterates regarding giffgaff’s approach here.
But that doesn’t stop Gill worrying about the state of his profession. While all employee value propositions and cultures should be different, HR professionals should still be highly mindful of the importance of these strategic areas and work tirelessly at getting them right, he says.
“Otherwise you’re going to pay for the psychologists and the trainers, the tech people… and what’s left? The operational side. And that’ll get taken over by a ‘bot… HR is at risk of being outsourced and becoming obsolete unless it starts adding more value.”
A key aspect of this is HR people thinking more like marketeers, feels Gill: “Marketeers are now obsessed with their customers. They never used to be, but now they obsess and ask them what they’d like. HR is probably 10 years behind marketing so what I’m trying to do is jump ahead”.
The next career move for Gill might be creating a larger HR department from scratch, “pulling [in] loads of different people and experiences not just traditional HR people,” he says.
“I’d like to set up more holocratic networks or teams,” he adds. “So you’d ask ‘who are the people we need for this project?’”
But he’s “super happy at the moment” where he is, he says, adding the overall career ambition of “impact[ing] the HR community a little bit more”. Somehow HR magazine doesn’t doubt that he will.
This piece appeared in the April 2019 issue. Subscribe today to have all our latest articles delivered right to your desk