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Use HR Systems as Drivers of Strategy

February 1, 1998
Related Topics: Service, Featured Article
Workforce talked with Greg Thomson, senior vice president of human resources at Owens-Corning, about the Rewards and Resources program. The highlights:

Q: How do you see the Rewards and Resources program fitting into the company's strategic plan?
A: Rewards and Resources is a direct result of one of our six strategy elements that are designed to have the reward system drive the strategic initiatives. We use all of the human resources systems and processes as either levers for change or drivers of the business strategy.

Q: In putting together this huge undertaking to totally revamp a system and to start with a clean slate, what lessons would you share with other human resources professionals?
A: We learned a couple of things. We definitely learned it takes a certain level of courage to say, "I'm going back to a clean piece of paper." Then we learned the payoff for that is virtually unlimited possibility. But, we also learned the cost of that is that it's a huge change when it comes to communicating to employees and to managers how they can use the reward system in the total scope of compensation and benefits to drive the business strategy.

Q: What was the greatest implementation challenge?
A: You're kind of doing two things at one time. You're changing the way you deliver compensation and benefits. You're linking it to the business result and you have to talk to people about the business results you intend for them to produce. It takes a lot more effort and energy to implement than we anticipated-and we thought it was going to take a fair amount.

Q: What impediments did you encounter in designing and implementing this new process?
A: The biggest impediment early on to the change process was [getting] the [internal] HR community itself [on board]. I remember being at a meeting of my top-60 human resources people in Chattanooga, Tennessee, and one of the Rewards and Resources folks was in the front of the room talking about this new program. HR [representatives were] very tentative and really cautious in their remarks. I ran up the center aisle of the room screaming and waving my arms, and I said to the presenter, "You've got to show some enthusiasm for this. And now I'm going to go back in the back of the room, and why don't you start over like you really think this thing's pretty good."

Q: What effect did your enthusiasm have?
A: That was a turning point in the whole effort because it engaged those top-60 leaders in our human resources community. They had to be convinced it was a good deal [so they could] support it and take it to the managers of the business and employees and communicate with [all of] them in a way that showed the real value of the program.

Q: Was there a key element in having employees accept the program?
A: The lesson learned is that people can accept that level of change if you communicate, communicate, communicate.

Q: Are there any other lessons you can share from this process?
A: Another is to make sure that business leaders at each layer of the organization can speak about the overall business strategy because the whole pitch here was we're aligning the compensation system around the business strategy.

It's as if you have invited your employees to the table and have asked them to join you in running the business. With that goes some responsibility [with which] I think you really put some teeth in this notion of having people help plan, participate and drive their own change process. Now they've got part of their earnings, both short term and long term, on the line, and so the old, autocratic just-tell-them-what-to-do way of managing is no longer really possible.

Workforce, February 1998, Vol. 77, No. 2, p. 80.

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