HR in the Digital Age: Finding the Right Balance
Bermuda Human Resources Association
Vanessa Hardy Pickering
Chief Financial Officer, Hamilton Re
Thursday, October 12, 2017
Mid Ocean Amphitheatre, Southampton Resort
I’m really pleased to be with you today. I want to congratulate you, as members of the Bermuda Human Resources Association, for resuming your annual conference after a seven-year hiatus.
The global recession began to impact Bermuda seven years ago, so I imagine you’ve been pretty busy dealing with how the economic downturn has affected Bermuda’s companies and their employment needs since then.
Even without the recession, I know that the HR landscape has changed significantly since many of you first entered your profession. As Carlos said, I hold the position of Chief Financial Officer at Hamilton Re but I’m also responsible for a number of other functions, including HR.
Since I’ve been involved with HR, I’ve learned that the opportunities and challenges facing the profession have been impacted by profound economic, social and cultural shifts.
Fifteen years ago – even 10 or five years ago – few of us imagined a world where more than half of the global population would be under the age of 30. This demographic is one of the most diverse in recorded history. As I’m sure you know, they’ve been labeled digital natives – meaning they’ve been born into, and expect to live their lives through, a world of screens.
The rest of us have come to take living online for granted, too. We’re all living in a digital age.
Along with digital natives, we have several other generations represented in today’s offices. When you chose HR as a career, did you expect to be managing such a divergent set of expectations of employees in their 20s, 30s, 40s, 50s, and 60s?
There’s been a running commentary for years about our aging population – we’re living longer, often in good health – but few predicted a workforce that wanted, or needed, to keep working beyond the traditional retirement age. Would any of us have expected this recent headline: I’m Going To Be Working Until I Die?
Perhaps those in the vanguard of information technology knew we’d be struggling with cyber threats that could cripple global commerce. I’m not sure any of us expected the imminent danger to personal and professional data security that we face on a daily basis.
Who forecast the disruption that Uber, AirBnB and iTunes have caused in so many industries? Who foresaw the impact on the skill sets and mindsets that employees need to be considered competitive and relevant?
In Bermuda, we have these issues and more. Some are unique to being a small multiracial, multicultural island dependent primarily upon two industries for revenue.
While many countries have grappled with the knock-on effect of the global recession, it hit us at a granular level in Bermuda. We used to pride ourselves on zero unemployment. Now we’re supporting a level of financial assistance that we’ve been told is unsustainable.
For the insurance and reinsurance industry, mergers and acquisitions became the go-to cost-saving option. The staff cuts that often accompanies M&A tends to be absorbed in larger communities.
Not in Bermuda. Here, M&A has meant that not only have people lost their jobs, but support for charitable giving has been reduced, as have other community-based initiatives that aren’t provided by government. What can have a ripple effect in a larger country can feel like a tsunami here.
Our industry has also been focused on using technology as a key tool in expense management. Managing expenses has always been an issue, but with a prolonged soft market, the inefficiencies in how we do business have become an urgent priority that must be addressed.
Tech-based solutions, that streamline operations and reduce expenses, can represent a threat to companies whose employees aren’t trained to adapt to new roles.
These solutions can include the introduction of robotics, machine learning and virtual reality. In Bermuda, where jobs are at a premium, the possibility of a Bermudian being replaced by a robot takes on a whole different level of threat.
As with every threat, there’s great opportunity, particularly for HR professionals who are excited about building strong companies in the digital age. Twenty-first century HR pros understand they play a critical role in helping employees to refocus their professional development on the requirements of working in today’s world.
Recently, Hamilton participated in the Top 10 Employers competition that’s organized each year by The Bottom Line magazine. I understand a number of the companies represented here today also entered the contest: Bacardi, the Royal Bermuda Regiment and Tokio Millennium all made it to the Top 10.
Congratulations to all of you. We share your commitment to being the best employer we can be. By the way, if your company hasn’t entered this competition before, I highly recommend it. It’s a great experience for management and staff and it offers an opportunity to learn a lot about how your employees are feeling about working for you and with you.
Hamilton entered this contest for the first time in 2015 and placed second. We didn’t enter last year but decided we should give it another go this year. We placed fifth, which we felt was just fine for where our company is right now.
I say “just fine” because we’re extremely competitive at Hamilton. Ordinarily, we would feel we should have come first!
But after three years of rapid growth, Hamilton is in a period of transition. Part and parcel with Brian Duperreault leaving were great opportunities. Each one requires additional attention and resources.
So our employees have been adjusting to change and a host of new priorities. By the way, they’ve been doing an impressive job, demonstrating the flexible, nimble corporate culture that we want at Hamilton.
In the end, we decided there were more positives to entering than negatives to entering.
The Top 10 Employers competition coincided with work we’ve been doing on an employee value proposition, or EVP.
At Hamilton, we have a bold mission: We’re writing the future of risk. Our mission is grounded in using data science and analytics to change our industry. We know that innovation and creativity are table stakes in the digital age.
We have a set of First Principles: Be smart, Be sensible, Be open, and above all else, Be more. Our First Principles outline the behaviour we expect from our employees. They’re the foundation of the Hamilton brand.
Our staff were very involved in developing these components of our corporate culture and value system, and we wanted them to be involved in developing our EVP. So we held focus groups in our Bermuda and London offices to get feedback about what it’s like to work at Hamilton.
We compared our Top 10 Employers survey results with what we heard during our employee focus groups. I’ll come back to this later.
When I began this address, I noted some of the paradigm shifts that our world is undergoing: the challenges of doing business in the digital age, managing a multi-generational workforce, and facing the reality of a growing under-30 global population that takes diversity and inclusion for granted.
We face each of these challenges at Hamilton. I’m sure you do, too.
We’ve adjusted our recruitment strategies to attract software developers and data scientists in addition to actuaries and underwriters.
We have employees who haven’t yet turned 21 and employees who’ve celebrated their 65th birthday.
Our staff are proud of our diversity. But we know that as we grow, the expectation that Hamilton is a diverse, inclusive company will only increase.
I’d like to suggest that these challenges – as critical as they are to a company’s success- can be distractions if you don’t get the basics right. And I don’t think the basics have changed much since anyone in this room entered the HR profession.
When it comes right down to it, the relationship between an employer and an employee is like any other relationship.
It thrives in an environment of trust, honesty, fairness, caring, respect and continuous open dialogue. It withers and dies in the face of inequity, injustice – and silence.
There are many words used to describe employees who feel their relationship with their supervisor and their company is a good one. The one we use at Hamilton – Jacqueline used it and it’s a focus of the conference – is engaged.
As Jacqueline noted, engaged employees feel they receive regular information about what the company is doing and what’s expected of them. They believe they have development opportunities as well as the right tools and resources to do their job. And they trust that they’re going to be fairly rewarded for their work.
In other words, they have a relationship with their manager and their company that they value and that inspires them to do their best.
While the basics of engaging employees may not have changed, the expectations of today’s multigenerational workforce have. So engaging employees is a more complex exercise than it used to be.
Employees want a rewarding experience at work. But “reward” doesn’t necessarily mean financial compensation. And the concept of retention is undergoing its own evolution.
On the reward side of the coin:
In a recent employee confidence survey by Glassdoor, 79% of employees overall prefer new or additional perks to an increase in pay. Amongst Baby Boomers, it’s 66%. Amongst Millennials, it’s almost 90%.
The most preferred perks included paid time off, flexible work schedules, gym memberships, and childcare assistance.
Similar results were found in a study reported in February in the Harvard Business Review. Given a choice between a higher paying job and a lower paying one, 88% of respondents said better healthcare and more flexible hours could tip the balance.
As with the Glassdoor survey, most Baby Boomers, Gen X-ers and Millennials all opted for perks over salary and bonus.
On the retention side of the coin:
I won’t repeat what Jacqueline covered this morning, but I’d like to reinforce some points she made.
As we learn more about the Millennial generation, we’re discovering they’re willing to make lateral moves at a number of companies if this means they’re in a satisfying work environment that supports a good work/life balance.
This doesn’t mean they’re not ambitious or loyal. It does mean that they put a very high value on a workplace that provides them with professional development and the flexibility to look after their personal life, too.
What about the other end of the generational spectrum?
What keeps a Baby Boomer at his or her job?
This is an interesting question. You’ll remember the “I’m Going To Be Working Until I Die” headline? It refers to a growing concern amongst people approaching retirement that they’re in no financial position to retire comfortably. This is as true in Bermuda as it is in the US, Canada, the UK or Europe.
People are working longer – sometimes because they have to, sometimes because they want to.
We have employees in their 60s working alongside Gen X-ers, Millennials and Gen Y-ers. Each of these generations have come of age in different social and cultural contexts. What each wants in a rewarding work experience may share similarities, but you know better than I do that the differences can be stark.
So if we’re talking about building a corporate culture for the digital age, where the expectations of multiple generations will need to be met, where innovation and creativity can thrive, we’re talking about finding the right blend of workplace engagement and work/life enhancement.
How can HR support the development of today’s workforce and the success of today’s companies? How can HR help us all be fit for the digital future?
I think you’re at one of those career crossroads that can be as exciting as it can be daunting.
Let’s look at some of the 21st Century keystones of your profession:
You have an opportunity to help management recognize how a workforce of multiple generations can strengthen a company’s competitiveness as an employer and as a business.
At the same time, you can enable different working styles that suit different levels of experience.
You can embed respect for the nine aspects of diversity into your corporate cultures. These are class, gender, race, ethnicity, age, physical and mental ability, sexual orientation, spiritual beliefs, and marital status. And you can make sure that every level of management walks the talk of diversity and inclusion.
You can advocate for the tools that translate innovative ideas into actionable reality, providing the technology needed to get the job done.
You can help your company put a premium on consistent, clear and effective communications at every level of the company, and give managers the training to be good communicators. And your performance management process can hold managers’ feet to the fire, making sure they take their responsibility to communicate seriously.
Here, you can help managers understand that effective communication includes constructive feedback as well as praise. It’s good to let an employee know where he or she can improve on performance.
You can understand that fair financial compensation matters, but it’s not the only thing that matters. Today’s younger workforce cares a lot about work/life balance.
They care about having a sense of purpose. And they want to work with people they care about.
I think it’s important to note that it will be almost impossible to gain any traction on what I’ve just listed if HR doesn’t have a seat at the executive table.
The further HR is from where strategic decisions are made, the harder it is to effect meaningful change.
If a CEO isn’t committed to diversity, you’ll be facing an uphill battle. If your senior management team doesn’t understand how to manage a multi-generational team, you’re going to be dealing with a lot of friction. And if there’s no strategy for aligning your company’s HR policies with your business imperatives, employees won’t understand the role they play in contributing to your company’s success.
One additional issue I’d like to raise here is specific to Bermuda.
We’ve been talking about the challenges and opportunities of being an HR pro in the digital age. There’s a growing concern that Bermuda’s kids aren’t being equipped with the tools and training they’re going to need to be competitive in tomorrow’s labour force.
We hear stories of schools with no access to WiFi, where classrooms share one or two laptops or computers.
Out of school, Bermuda’s kids are as screen-savvy as any that you’ll find in the developed world – maybe more so, as we’re one of the most well-connected communities on the planet.
But for too many of our school-age children, the digital reality they experience at home is an analog one at school.
Ultimately, this presents you, the HR professional, with a real dilemma. You need a competitive, 21st Century workforce. You’d prefer to hire Bermudians. What do you do with the gap between what you need and the skills your local workforce brings to the table?
This is a real issue, and perhaps we could consider being a part of the advocacy for change in this regard.
I mentioned earlier that we had compared focus group feedback from our employees with the results of our Top 10 Employers survey. We were pleased to see that the themes from both exercises were pretty much the same.
In spite of the transition period we’ve been in this year, our employees believe in our mission. They care about each other. They enjoy the opportunities they’re given to stretch and grow professionally. They value Hamilton’s commitment to the Bermuda community.
They’d like more flexibility with their work schedules, a few more perks, and more tools to do their job.
In other words, they sound a lot like the employees cited in the research I’ve referred to today.
I don’t think this means we’re the prototypical 21st Century company. I think it means we’re like every other company competing in an evolving world, and like every company represented here today.
We all need to lay the foundation for good relationships and fit-for-the-future workplaces.
At Hamilton, we’re working hard to get it right. And next year, we’ll have our sights set on first place in the Top 10 Employers contest.
In closing, I want to congratulate you again for resuming your annual conference. What you’ve learned today from Jacqueline and from Sharlyn, and from each other, will only enhance the value you bring to your companies and to your colleagues.