“Never waste a good crisis.” That’s the lesson home insurance and repairs company Homeserve UK CEO Martin Bennett learnt from his predecessor. And it has been quite a good crisis, by all accounts.
In 2011 the Financial Conduct Authority (FCA) stopped Homeserve’s UK business from selling any more products. In 2014 it was fined £34 million by the FCA for mis-selling. “We do still hold the unfortunate record of having the largest single retail fine from the FCA,” says Bennett.
But, on his promotion to CEO of the UK business in 2014 (he previously held group leadership roles in operations and finance), Bennett managed to see the opportunity. “We had to let people go, and it was life-changing for the business, but it gave us the chance to look at what we were doing and come up with a different way,” he says.
“We were able to sit back and say ‘we are going to put our people first’. In a crisis you can go back to basics. We had the chance to turn things around and say ‘if we do nice things for our people they will do nice things for customers’. And it’s working so far.”
It’s working so well that Bennett was recently crowned joint winner of the Most People-Focused CEO award at the 2016 HR Excellence Awards, for bringing innovative people practices to a “largely unloved sector”, in the words of one HRD judge. HR magazine caught up with Bennett at Homeserve’s Walsall HQ to hear how he’s done it…
1. Listen to your people
“All I’ve done is engage with our people to ask: ‘how do we build a great business?’” says Bennett. ‘We set the strategic direction; they’ve got on and delivered the great stuff day-to-day.” That has meant engaging people in refreshing company values, and even in the products Homeserve now offers.
One critical initiative has been the launch of ‘Customer First’, the brainchild of chief marketing officer Greg Reed. Customer First is groups of employees from across the business who meet every morning to discuss customer issues various staff have raised, and resolve them if necessary. “If you [as an employee] see something that doesn’t work for customers you have the chance to raise it,” Bennett explains. “The Customer First team looks at whether we should do something special for the customer, change the process, or whether we are doing the right thing and the customer isn’t right. It’s part of our DNA now. Trusting the people around you to do a good job is the only way you can run a business positively.”
Customer First costs Homeserve £150,000 a year, but Bennett says “it’s been worth much more to us than that, as we’ve changed processes”. Examples include no longer asking for excessive documentation when a customer dies, instead trusting the family; and introducing basic life-saving training for engineers after one saved an elderly customer’s life when she didn’t answer the door.
2. Think about processes
Before the change people were rewarded on how much of a certain product they sold, so it’s not surprising this drove the wrong sorts of behaviours. As Bennett says: “How you reward people is how they are going to behave. If you’re going to get another 50% salary for selling things, you’re going to sell. How you do it will be secondary.”
Now people are rewarded based on feedback from customers and quality scores. There are also reward mechanisms aligned to demonstrating Homeserve’s values, and appraisal processes have been revamped to reflect the desired behaviours. “[The values] have become part of who we are,” Bennett believes.
3. It’s good to talk
“Whether you’re someone cleaning drains, a marketing manager, or working in HR, you need to understand your role in delivering the strategy,” Bennett says. To ensure everyone hears a consistent message Homeserve runs ‘cascades’ at all its sites; where everyone comes together to hear how the strategy is progressing, and to ask questions of the executive team. “It’s about what’s important next, and what is your role in that.”
Bennett also sits on Homeserve’s ‘big red sofa’ every two weeks, recording a video interview with others in the business – “two weeks ago we managed to take our internet down as [too many people wanted to watch it]”. The company has also embraced Yammer – out of 2,750 or so employees almost 90% have engaged with Yammer in the last month.
However, Bennett understands that different people want to communicate in different ways. “Yammer is just one way of communicating… some people will send me a letter, others Facebook message me.”
4. Embrace transparency
Homeserve has embraced employee review website Glassdoor, where Bennett has a 96% approval rating and is one of the highest-rated CEOs. The company asks employees to leave anonymous reviews and welcomes transparency. “You’d pay a consultancy a fortune to tell you [what you can find out on Glassdoor],” says Bennett. “You can’t hide anything. People will be aware what kind of organisation they are joining.”
Being comfortable with openness and transparency is something all leaders have had to get used to. There are no offices at Homeserve, meaning anyone can come and talk to the exec team. “It can be quite exhausting to be that open and accessible,” Bennett admits. “You have to keep going at it, but you can’t do it alone everyone has to do it.”
This means “changing leaders” if they won’t change their attitudes. “Our old compliance director didn’t want to give up his office. That’s fine – just get a different compliance director,” says Bennett. Similarly, when a previous operations director wouldn’t engage with Yammer: “It was pretty apparent that was not going to work. One person can make the whole thing feel wrong, so you have to change the people.”
5. Average HR isn’t good enough
For Bennett, “HR can enable strategy delivery more than any other [role]; they have the ability to get the right people, train them and keep them.” That means he wants the function to be more confident. “HR always forget how important they are. Average isn’t good enough in HR – you need to take your best people and put them there. HR has to understand it is part of the strategic answer.” Perhaps tellingly, he has chosen someone from a non-HR background to run Homeserve’s people function.
He sees HR as “more than a support function”, and wants those in the profession to do the same. “HR are my eyes and ears around the business from a people perspective. They need to know how staff are feeling and be proactive, not reactive.”
Bennett also believes the HRD is the best placed to tell the CEO when they are not doing a good job. “It’s hard for people to do that, but the HRD should ask ‘were you really living our values when you did that?’ It takes a good HRD to be confident enough to do that.” Just as well then that for his next role Bennett fancies being an HR director in a FTSE 100 company…