Adding value as a business was freed from the shackles of formal hierarchies a long time ago. More and more businesses have introduced specialist units, staffed by highly qualified experts organized temporarily into project teams – even, dare we say it, working outside traditional organizational structures such as top and bottom. The problem is, the value chain still does not place enough value on project managers, specialists, analysts, accountants and many others. If you want a successful career, you’ll probably have to climb the career ladder to top management – managing ten people, then fifty, then one hundred…
This model is a far cry from the modern approach to adding value found in business. It was this realization that motivated the client of Steinbeis Transfer Center Technology – Organization – Human Resources, one of the large German high street banks, to put its entire career planning and remuneration system under the microscope. The result: a completely new business model, linking transparent and flexible career paths for thousands of people inside and outside Germany to market-based payment levels.
It was a challenging project that, more than anything, would involve quickly sitting everyone around one table – specialists and managers – and moderating project meetings, methodically, stringently and tactfully. Why? Because this project would involve a variety of people talking about career models, there could be no room for misunderstandings, inconsistencies, or different interpretations – whether fundamentals or details. Especially important given that the results would feed into personnel systems, processes, HR data systems and related IT systems.
To make sure the new model slots smoothly into existing systems and is understood and accepted by employees, a number of key criteria had to be taken into account:
The launch of the new career model paved the way for new remuneration models and HR development. Given the volatility of the market, it was important to set up a system that would be reliable and sustainable in the medium term, yet still flexible enough to cushion the effects of market changes, changes in the organization, or shifts in the labor market. In essence, it was and still is about achieving a healthy balance between stability and change.
Even though the German banking sector is expected to be much less dramatically affected by future demographic changes than many people maintain, it was important to create a system that would pick up quickly on demographic shifts in bank personnel and come up with practical solutions. As the new concept would be largely based on different seniority levels (from juniors to principals), in the future this would be possible at the click of a mouse.
Another issue to think about was the attractiveness of the bank as an employer, crucial for some segments of the labor market. For a company to keep recruiting the right people, potential employees must be convinced that highly qualified specialists working in the field of product development, due diligence or risk analysis have a genuine opportunity to forge a career without immediately being pulled into managing other people or taking on management responsibility. This was pivotal in convincing the customer of the Steinbeis Transfer Center Technology – Organization – Human Resources that it should go ahead with the planned system.
Then came financial factors: as salary studies prove, the new model would allow the company to match market salary trends, including all variable and optional elements of remuneration packages. This provided an template for addressing the typical sort of questions that used to come up such as “What’s the going market rate for people in similar jobs or with similar qualifications?” – making it possible to put people into salary bands and work out remuneration levels.
“We value people who add value” – this has become the new maxim at the bank when it comes to HR development, careers and pay. The project has also already resulted in a much more systematic and professional approach to personnel management – thanks to the support of Steinbeis!
Prof. Edmund Haupenthal
Dr. Viktor Lau
Steinbeis Transfer Center Technology – Organization – Human Resources (TOP) (Gottmadingen)
stz151@stw.de