The rise of the cross-sector HRD
Moving between the public, private and third sector can be hugely rewarding both professionally and personally
Most can – unfortunately – think of a few contenders for their toughest day at work. For Martin Tiplady, former HR director of the Metropolitan Police Service and Westminster Healthcare Holdings, and now MD of Chameleon People Solutions, one particularly stands out.
It’s the day he went around with the MD of Westminster Healthcare before the annual general meeting to visit investors and explain some “fairly expensive remuneration issues”. “As the day went on it got harder and harder,” he comments. “It was one of the hardest things I’ve ever done. They were absolutely interrogating what we were doing and why. It was stuff to really trip you up.”
A fairly close second for Tiplady is when he first joined Westminster Healthcare from non-departmental public body The Housing Corporation (abolished in 2008). He recalls being interrogated by a senior leader on how much an appraisal programme would cost.
“I said ‘I think it’ll be paid for by reduced attrition’. He said: ‘No, that’s not my question. I said how much is it going to cost and when do I get my money back?’
So I gave him another waffly answer. He stopped me and said ‘Martin, if you learn one lesson from this, I love what you’re saying, but never come into my office without knowing what a programme costs and when I’ll get my money back’.”
For Tiplady both instances were watershed moments where he realised the very real differences between the public sector environment he’d started life in, and the commercial world he’d progressed to. These anecdotes spell out just why most HRDs have historically stayed in either one.
And yet Tiplady is an example of someone who’s been highly successful in both. He epitomises a growing number of a new breed of multi-sector HR professional – individuals who have realised the significant benefits to be reaped by gaining experience in very different worlds and applying the learnings across.
A different lens
Head of HR at the Motor Neurone Disease Association (MNDA) Peter Reeve is another example. As well as working in the charity sector, he also has experience of HR at construction firm Kier Group, Kettering General Hospital NHS Foundation Trust, and at Barclaycard.
For him the key value lies in being able to challenge accepted ways of doing things. “There’s increasingly a recognition among HR people that you are much more credible if you can talk about a range of experiences,” he says.
“Most of your line managers won’t have that frame of reference, they don’t tend to move as much. Whereas HR is an area where you can and it’s very helpful. So I have lots of conversations around recruitment practice, for example, because the people I work with often come from the public sector so have much more of a set process. I can say ‘that’s only the process in the public sector’.”
“You look at things through a different lens and perhaps ask different questions; so challenging the ‘it’s always been like this’ mentality,” agrees Alison Rumsey, HR director, infrastructure projects at Network Rail, whose previous positions include HRD of the Department for Transport and at the Department of Energy and Climate Change, and HR manager at Abbey National.
Anna Penfold, consultant at executive search firm Russell Reynolds, agrees with Reeve that HR is “probably one of the most transferable” of the functions.
“There are lots of functions like R&D and supply chain where the depth of knowledge about a product base tends to be a higher requirement,” she says.
Tiplady has plenty of examples of his private sector experiences informing his approach as HRD at the Met. He recalls sitting in a meeting about a significant IT investment and scrutinising its ROI as he learned to do at Westminster Healthcare. What ensued in the meeting was “a slightly heated exchange” with a senior policeman, but also a much more rigorous payment plan for the investment, he reports.
Wendy Cartwright is currently NED at the Ministry of Defence. Former HR roles include at the Olympic Delivery Authority (ODA), Defra, Standard Chartered Bank and EDF. Having experience of both sectors allows an HRD to balance the fact that both typically boast decision-making process drawbacks. “If the board makes a decision and you just implement it, versus the purely consultative approach of the public sector, neither works well. So it’s bringing those two skillets together,” she says.
Gaining experience in different sectors has been both incredibly rewarding and critical to her career development, feels Cartwright. “That’s definitely helped my career; I am sure that one of the reasons I got my role at the ODA was because I had worked in both private and public sectors,” she says, adding that this also “definitely benefitted [her]… in terms of taking on more senior roles more quickly.”
“If an HRD aspires to get on the top table, like anyone else round that table they have to have that broader view,” agrees Peter Unwin, chief executive of cross-sector learning charity Whitehall & Industry Group (WIG), of the career-enhancing value of cross-sector experience. “Those who don’t seek cross-sector experience will limit their potential.”
A necessary factor in supporting the rise of cross-sector HR professionals is increased awareness on the part of businesses and their leadership teams of the value this adds.
“When the downturn happened in 2007/8 a lot of organisations started to become a bit more risk averse about where they were hiring from – so not just hiring ‘people like them,’ but also even from specific sectors,” says Cartwright.
“It was about not rocking the boat… but now we’re starting to see more movement in the market and people more open to taking fresh ideas on board and doing things a bit differently.”
This forms part of a wider search and recruitment revolution, particularly at executive level, explains Penfold. She highlights that there’s now much more recognition from boards of the importance of cultural fit and potential versus experience, and many more tools available to assess this fit.
“I think organisations are much more thoughtful now around talent; it is a much more sophisticated process than ever before,” she says.
“I’ve been buoyed in the last few years by the open-mindedness from industries that traditionally have always wanted to recruit like for like. I would even count retail among that… That’s an overt mandate we’re being given.”
Organisations are now realising that broad categorisations of ‘public, private and third’ don’t stand up to more thoughtful scrutiny, explains Mike Falvey, partner at KPMG, former chief people officer at HMRC and former interim HRD at DHL Express. There are many more synergies between on the face of it very different entities, he says.
“In the past we’ve all too often looked for differences rather than commonalities,” he says. “But the challenges are remarkably similar across all sectors or subsectors. So we use this proxy, but I think those lines have become increasingly blurred. It’s a far more complex picture than that.”
He adds that “people are starting to realise different environments have faced the same challenges.
“High-street banking for example faces many of the challenges of any other retail organisation. But in days gone by a high-street bank wouldn’t necessarily have recruited from a major grocery chain. But if you think about large workforces disrupted by automation and AI they have a lot of similarities.”
Martyn Dicker, director of people and learning at The Prince’s Trust, agrees that in his experience similarity of organisational context can’t be predicted by broad classifications. “It’s recognising that even within a particular sector organisations can be very different,” he says. “The reality of organisations I’ve worked in is – even though they’re all in the charity sector – they’re vastly different. You have the context of the International Red Cross and Red Crescent Movement, which has a 100-year history. Whereas Fairtrade is a much younger foundation…
“The Children’s Investment Fund Foundation (CIFF) on the other hand is a philanthropic foundation with an endowment of more than $4 billion, and an ability to compete with the private sector for the best talent.”
“The language used changes and is completely different even when you go from one local authority to another,” points out managing director (business enterprise and shared services) at Buckinghamshire County Council Gillian Quinton regarding the limitations of broad sector categorisations.
Reeve points out that, where people often assume third sector HR would be very similar to public sector and lump the two in the same category, charity HR has a lot more in common with that in the private sector: “HR are often the only people in the third sector who know how much everything costs and are making decisions on that,” he reports. “If you’re moving from the public sector you’re going to have to learn that pretty quickly.”
Public sector high performance
Another crucial factor in the rise of the multi-sector HRD is the transformation of the public sector over the last few years. Local authority and commercial settings now have much more in common than ever before because of the austerity agenda, says Quinton.
“I think more and more in the public sector are becoming more like some of the commercial professionals we see,” she says. “We’ve had to because of the austerity agenda. We’ve had to become more outcome-focused and really focused on what the evidence says, what metrics we can use – all the things you’d expect to see in a commercial environment.”
“I think we’re very quick to judge the public sector that there’s a lot of bureaucracy and admin but there’s a lot we could learn from them that they don’t get credit for,” says Penfold. “If you think about the MoD: you have the internal stakeholders in your departments, you’ve got the cabinet office, you’ve got the government, the person on the street, the Daily Mail… Your stakeholder or customer group is arguably the most complex.”
“If you’re HRD at DWP that’s a pretty tough job,” agrees Unwin. “Managing people at a time of pay restraint and increasing pension contributions, getting the talent and retaining it and increasing staff engagement, is demanding. Private sector HRDs coming into government have found some pretty big challenges.”
However, there are still marked differences between public, private and third sector that anyone wanting to make a switch will need to be highly mindful of. While public sector HRDs may have gained commercial acumen over the last few years, dealing with investors and shareholders at a private firm is still (as Tiplady’s experiences highlight) not for the faint-hearted.
“There’s definitely different emphases and skills,” says Penfold. “For example if you don’t like comp and bens don’t work in financial services. For the next five to 10 years the regulators aren’t going to suddenly let up, so you’ll be doing a lot of that.” Rumsey adds that “in the private sector the pace of change can seem very different”, which can be a real shock to public sector professionals – one they should consider carefully whether they’ll enjoy.
Similarly public sector HR presents some highly unique challenges. “There’s this phrase I hear a lot which is ‘the ability to deal with ambiguity’,” says Mark Turner, joint managing partner at recruitment, leadership and talent consultancy GatenbySanderson. “There’s this test of: can someone cope with shifting sands and decision-making and adapt and deliver with that kind of backdrop?”
While liaising with investors in a private sector environment can be tough, public sector HRDs must face up to a different kind of (potentially very personally draining) public scrutiny, says Reeve.
“In the public sector you need resilience – you are going to have to deal with on occasion quite belligerent trade unions,” he says. “When you’re being attacked on a professional and personal level by a trade union rep, that’s quite hard to deal with. I did a skill mix review in an A&E [when at Kettering General Hospital NHS Foundation Trust]… We turned up on the first day and there was the union shop steward, the union officer, a reporter and a photographer from the local paper because everything’s very political in that sector.”
Bridging the gap
So HR professionals looking to build portfolios of multi-sector work will need to think carefully about how they can best bridge this potential divide. “It’s got to be a good fit. So you’re probably not going to jump from the public sector to the most commercial bottom line-driven organisation where there’s no connectivity to a public service environment,” advises Turner. “But you might see people moving to utilities or former publicly-owned services where there’s a big customer interface and a dispersed workforce.”
“When I joined government, then DPI which became the Department for Business, I did that because I knew they would talk a language closer to what I had come from as it was talking business,” agrees Rumsey. “So it was a good place to start.”
Rumsey adds that anyone looking to make a switch will still need to do a fair amount of preparation.
“It’s finding somebody in HR already in that sector and using them as a formal or informal mentor,” she says, adding: “There’s so much more now on social media in terms of being able to do your homework before you move. And I would really encourage people to do their homework because there’s a huge amount you can learn.
“Things like local CIPD networks are a great place to go and talk to people in a different sector and ask those questions you wouldn’t want to ask at an interview. So use your network. You can then judge the size of the leap.”
“People can leverage knowledge now like never before,” agrees Penfold. She points out HRDs should be doing this and transferring best practice between sectors even where not looking to ever work in their private, public or charity sector counterpart.
Indeed switching between sectors, while incredibly rewarding and career-enhancing for many, won’t suit everyone. It won’t, for example, suit someone who’s been in HR for a long time and who’s sat in one very specific job or sector all their working life.
And moving between very different organisations will take a certain sort of person – “someone who asks the obvious questions and listens to the answers,” advises Reeve.
“You need to have an openness to learning,” agrees Unwin. “If you’re good at your job you will have that exposure; you’ll have found ways. If you’ve done a serious job you’ll have had to interact with other sectors. The simple answer is: the better you are the easier it is to switch.”
Penfold adds that no professional – HR or otherwise – should see this as leapfrogging between posts: “This isn’t about flitting. There is still a golden rule in my mind of spending at least two or three business cycles in one organisation to really understand how to affect change,” she says.
Making a significant switch and assessing your chances of doing so successfully might still in large part be about persuading the hiring company, adds Falvey.
While many organisations have now ‘seen the light’ and are fully on board with more sophisticated search and selection, many still cling to a narrower approach.
“Unfortunately as with so many things, this is about us selling ourselves,” says Falvey. “If you recognise there could be those perceptions or misunderstandings you have to demonstrate what you’ve achieved that’s directly comparable and relevant. So it’s quite a hard conversation.
“It’s not about ‘talking the HR agenda’ and hopefully most HRDs don’t do that now anyway. It’s about knowing what you want to be seen as good at. That’s part of the case for why you never have a generic CV.”
Unfortunately closed-minded search and selection is still a particular problem for those looking to transition from public to private sector HR, reports Turner. “It feels like it’s been a bit too much one-way traffic over the last few years,” he admits.
He explains that the issue is that while public sector cuts have encouraged innovation and sharper thinking in some circles, in others this has compromised public sector HR influence, further worsening assumptions and stigma here. “Because of the drive for greater efficiencies over the last few years public sector HR has maybe lost its seat at the board table a little bit,” he says.
“There has unfortunately in the recession been a downgrading of HR in some places,” Quinton agrees. “We’ve had to condense some of our senior roles and have fewer of them. So some have taken much broader roles and some have been delegated to the next tier of management. People have left and the organisation has taken the opportunity to downgrade the post.”
But there is, as Unwin and Penfold highlight above, still much exemplary and progressive practice here. And it’s up to the public sector to shout about it more, says Quinton: “I think it’s about putting yourself forward; it’s putting ourselves forward for the recognition and the awards,” she says.
The path to success
So the opportunity is certainly there for the taking if HR professionals feel up to a big new challenge and, in the words of Reeve, “walking around with a ‘what the hell’s going on here?’ face for a while”. While traditionally hiring teams and boards were much more narrow in who they’d consider, a heartening search revolution seems to be underway.
And while in some circles it’s still easier for corporate HRDs to move to the public sector rather than vice versa, public and third sector professionals are now being recognised for the commercial acumen and indeed public and third sector-specific skills they bring to the table.
Penfold is encouraged that organisations, despite the Brexit- and new government-shaped uncertainty and challenges coming over the horizon, won’t roll back the clocks and revert to reactive, less sophisticated HRD selection. “We understand so much more about the long-term value of doing things properly now,” she asserts.
Rumsey would urge any HR professional to consider how rewarding moving through different organisational worlds can be. “One of the joys of moving between sectors is learning what makes people tick in different businesses, what’s important, what drives the business…
“If you go in with a learning mindset that really sets you on a path to success.”