Newsletter Volume 9

OUR NEWS &

INSIGHTSON Q...Globalisation has been given a kick in the shins by voters on both sides of the Atlantic. ‘Change is unpredictable’. Yet, so many people were shocked by the unpredictability of Brexit and the US presidential election.

Businesses have embraced digital technology, found cheaper ways of manufacturing goods, and have taken advantage of off-shoring various business functions. Employees, displaced by these developments, have felt let down and disenfranchised.

Sixty percent of projects that Q5 support involve some form of ‘globalisation’ – be it organisation restructuring or designing and implementing ‘digital’ ways of working.

But, change also brings opportunity. Q5 itself grew out of a frustration with the way the Big 5 consulting firms had evolved in the ‘90s and ‘00s. Many business leaders began reacting against oversell - ‘you will need forty consultants for the next 18 months’. Too many change projects were going off track. Q5 seized on this sentiment. We wanted to build a firm that became the authority on ‘change.’ We wanted clients to think of Q5 first, when they needed ‘to make change happen effectively’. We’d partner with our clients (not ‘do’ to them). We’d mobilise small, highly capable teams. We’d work on a fixed fee to a fixed brief wherever possible. Since 2009, Q5 has grown at an annualised rate of 60%. We serve about 70 different client organisations a year, from our offices in London, New York, Sydney and Hong Kong. Our projects last from 3 weeks to 12 months.

It’s a given that Q5ers are deeply experienced in organisation design, process design, strategy implementation and change management. One differentiator - at least to Big 5 firms - is that every Q5er is immersed in the ‘rhythm’ of business. They oversee P&L. They manage cashflow. They know what a ‘debtor day’ is. They care about the commercial success of your organisation, and the reputation and performance of our own.

Will business leaders turn their backs on globalisation? This is very unlikely in a digital economy, whatever politicians say. However, we do, as business leaders, have a responsibility to think wisely and compassionately about the people in the organisations we lead and the markets we serve.

We need to be circumspect in the way we support those people who are dislocated by our corporate decision-making. If we want our businesses to enhance their influence and reputation, we must support and develop those who are most impacted by business change.

Business has a pivotal role to play in society. Q5 will continue to work with business leaders to support the communities that are most disrupted by change, building new skills and capabilities.

We hope you enjoy this newsletter. It offers a few glimpses of the work we do. We’d love to hear from you.

Olly Purnell, Managing Partner

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Why Q5?

Since opening our Sydney office in September 2015, our friendly team has been busy working with several iconic brands – particularly in the Media and Higher Education sectors. Our personal, pragmatic approach has been going down well with the CEOs and business leaders that we’ve partnered with.

And thanks to a rapidly growing network of Q5ers, associates and partner organisations, we’ve been able to draw on a wealth of local and global knowledge. All in all, a fantastic start!

We help our clients deliver sustainable change that lasts for years. We want you to keep thriving beyond the intial four quarters and that is where our name comes from: Quarter Five or ‘Q5’. We’re a lean and nimble firm with a global reach and work closely with our clients to get the best results - because no one knows your business better than you. We specialise in the following areas:

Spotlight on Sydney

PROCESS

Efficient and value adding. We help clients identify and improve the processes that are crucial to their success as a business. We do not create mountains of process maps, which all too often get left unused on a shelf, we work with our clients to decide what work needs to get done to ensure everyone is clear about ownership of tasks and understands their role.

STRATEGY

Set the right direction. We help our clients to ‘think big’ and realise their potential. It’s about creating strategies that are clear, implementable and that deliver results.

DESIGN

Fit for purpose organisation design. We help clients design a fit-for-purpose structure that is scalable for their future ambitions. Our approach to organisation design places our clients at the heart of the process. We provide rigour - our methods and OD toolkit are frequently described as ‘the best around’.

CHANGE

Make it stick. We support our clients to manage change to their advantage, to understand what it feels like to experience change and build the skills they need internally. We give clients the tools to shape, plan, communicate and monitor activities to make the change ‘stick’.

PEOPLE

Engaged, aligned and motivated. We help clients inspire their people to fully understand and connect with their roles in a new way - to think differently, behave differently and deliver results. We bring experience of what we have seen work, what doesn’t work and we always listen to what is going on in their organisation. We do not come with any preconceived ideas about what will work.

PROUD TO WORK WITH

A FEW OF OUR RECENT CLIENTS

This summer we held our first ever Olympics – or ‘Quolympics’. In London, around sixty Q5ers, along with their friends and family, threw themselves into the long jump and sack race, before bringing their A-Game to the egg and spoon race and three-legged sprint. Our athletes ranged from toddlers to giants and the emphasis was very much on having fun (although,

for the record, the green team won). Not to be outdone, our Sydney team held their own games on Coogee beach, where they sprinted, jumped and threw wellies in the air. And whilst the London team’s finale was a traditional tug of war, our Sydney Q5ers headed to a nearby restaurant for an intense prawn-peeling contest!

A Masterclass in Organisation Design

Q5 stage ‘Quolympics’

‘The team that’s leading the change needs to spend time together.

Communication must be transparent, frequent and

clear.’Matthew CrummackCEO gocompare.com

(previously CEO Lastminute.com)

British Airways faces a rapidly evolving external environment, and needs to ensure that any organisational change initiatives ‘stick’. We partnered with BA to create and deliver a series of bespoke organisation design ‘Masterclasses’ to 52 HR and business leads.

Across two days, we equipped the HR leaders with a specially adapted approach and toolkit to help them improve the delivery of organisational change. We also invited leading thinkers with vast amounts of experience (including ex CEOs of lastminute.com and Virgin Media) to share their views.

BA’s Head of Organisation Design said the Masterclass was ‘an excellent intervention, which will change the way BA approach organisational design.’

If you’d like to know more about our Q5 Masterclasses, please do get in touch.

‘If you’re new to organisation design, trust your intuition and

make sure you’re backed up by a framework. Define a simple set of enduring principles that will guide

your decisions at the toughest moments. Make strategic choices on big pieces of activity before the

detailed roles or structures – what is often called the ‘operating model’ –

this is the essence of design.’Jaimini Lakhani

Head of Organisation DesignBritish Council

(previously Burberry)

Liz NeighbourGroup Head of Talent and OD

Balfour Beatty (previously BAA)

‘To overcome change fatigue (after many rounds of transformations), you should

honour the past and listen to the stories. Demonstrate that you’ve learned and demonstrate how

this time it is different.’

‘Organisation design needs to last for years, so it’s worth taking time at the beginning to make sure you get it right. It may take a month or two

longer to work it all out, but it’s well worth the investment.’

Stephen Beynonex MD British Gas Residential Energy (previously MD Virgin

Media Business)

Sharon Rice-OxleyPartner

Some wise words from our expert panel...

Nicola Kane works for Credit Suisse as a Managing Director and Head of Group Operations for UK IB Entities and in 2006 she was one of 35 (out of 262) women who were promoted to MD at Goldman Sachs. Not bad for someone who ‘fell into’ her dream job! Here, Nicola talks about her own leadership style, the challenges facing the Financial Sector, and why we should all make time for coffee.

What’s the best career advice you’ve been given? One female manager told me to ‘take time to have coffee’, which I thought was an odd thing to say, but what she meant was invest in your network. Building rapport with people is so important: it makes it easier to talk about contentious issues and solve problems. She also told me not to make things look too easy. I think it’s a female trait, expecting results to speak for themselves, but if you never tell your manager about the challenges you faced, they get no insight into the skills you brought to bear. It’s about self-promotion, but without boasting.

What attracted you to the Financial Services sector in the first place?I rebelled after A levels and joined a management scheme at a retail bank instead of going to university. But I soon learned that it wasn’t for me, and enrolled on a Business degree. I then worked for Deloitte in their financial consultancy before qualifying as a Chartered Accountant. My move into Operations came about by chance, when a recruitment consultant sent me to JP Morgan for an interview. I had no idea what Operations was at the time, but it was a watershed moment: I’d found a job that I love which played to my strengths.

You were at Goldman’s for fifteen years, what makes them so successful? People take a lot of ownership and accountability. They hire people who are

very driven, motivated and competitive. It works for them, but it wouldn’t work everywhere. I was very conscious of adapting my skills when I moved to Credit Suisse – I tried to understand their culture rather than expecting them to adopt the Goldman’s culture.

Why do you think it’s tricky for women to gain senior positions in the Financial Sector? Firstly, there are a number of women who, if they wanted to, could achieve it, but perhaps don’t because they make other life choices that’s their choice and they can still have a valuable and rewarding career. For those who do want to get to the top, recognising the traits that define success is key, how to demonstrate those behaviours in a way that is still genuine and true to yourself is the art. For example, I tend to motivate people through encouragement “the carrot”, but when that didn’t always get the results I needed I had to develop some “stick” behaviours. At the end of the day it’s about balance, what do I need to do to achieve the desired end result and how do I do that in a way that is genuine and true to myself.

Hopefully the HM Treasury’s Women in Finance Charter will continue to encourage more firms to support women in top positions. Credit Suisse has signed the charter which requires Board accountability and commits us to a minimum number of females in key governance roles. Ultimately we will be looking to tie results in with performance.

What’s your leadership style? I’m proactive, I take ownership and I don’t micromanage. Although I delegate, I don’t abdicate, so I still ‘own’ the problem. I believe in teamwork and collaboration. I try to be honest about the what and the why, build trust and value honesty and integrity.

What lessons can we learn from the 2008 ‘financial crash’? Humility! An appreciation that the majority of people don’t understand, or see the value of, what we do. There’s a need to educate people and re-build trust: we’re not all ‘evil’. Regulation is a necessary evil which we all need to comply with, however, as important as the letter of the regulation is, the underlying principles and intent are what we also need to embrace to rebuild our reputation.

What do you think are the biggest challenges for Financial Services? Cost is a huge challenge, the burden of compliance with regulation is adding significantly to the cost base. We need to find cheaper more efficient ways to operate, offshoring to Poland or India is not going to be enough. We need a step change in technological innovation.

How do you relax? It helps that I’m good at compartmentalising, and can easily switch off from work. I have an incredibly supportive husband, and teenage twins who keep me grounded. We make a point of sitting down for dinner most nights and discussing our day. I recently took up the piano, and I love the way that it focuses my attention – but I’m a slow learner and my family are getting really fed up of Silent Night!

Magic SpongeSoaking up the wisdom of the smartest thinkers we know…

London: +44 (0) 20 7340 0660New York: +1 (646) 569 9198Sydney: +61 02 8310 5354Hong Kong: +852 8192 4416

@q5partnerswww.q5partners.com

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Although I delegate, I don’t abdicate, so I still ‘own’ the problem

When costs need to come out of a business, the first instinct is to try and use your current methods better – perhaps cutting hard and fast from the top down; or implementing zero-based budgeting, then justifying what to keep. But what if your current thinking won’t take you far enough?

Our overwhelming experience shows that when companies focus on short-term costing, it often causes unintended consequences. Relying on 10% cuts, without really understanding where these costs are coming from, only leads to the ‘elastic band’ effect: costs taken out ‘spring back’ six to twelve months later, as the underlying activity still needs to be carried out.

Evaluating your costs presents a fantastic opportunity to review your whole organisation: to identify the areas that are working well, and where value is being added - or destroyed. It involves thinking holistically, in a systematic way, about your entire organisation.

TIPS ON WHERE TO START

What’s your competitive advantage?Decide on what will enable you

to survive the current challenges, whilst ensuring that you’ll be better placed than your competitors when the markets improve.

What’s working well right now?There are things about your

business today that are working well and could form the basis for future success. Building on what’s great already means that you’re starting out with positive intent.

What are the implications?Put your customer and your people at the heart of every

efficiency saving. Your organisation cannot function without both of these – regardless of how healthy your new balance sheet might look. This may mean radically re-thinking what the ‘essential costs’ are.

Are you making the most of the opportunity?Cost transformation should

be a platform for success, not an emergency procedure. Don’t miss the chance to review your operating model. What would make your organisation easier to engage with? How could you function better internally? How could you deliver products and services better and quicker?

Have you set targets, and does your team know what they are?

Measure the things that you want to see changed and make sure that everyone knows how they can contribute. Clearly communicated signs of progress will bring your team together – they’ll see what’s changing and why.

Our collaborative, holistic, future-focused approach has already achieved great success for a diverse range of clients. For example, an organisational review created a £30m annual saving for a sports governing body; and a series of work-shops with staff at a major UK retailer resulted in a new structure at Head Office, alongside an annual saving of £4.6m. To find out what we can do for you, please contact one of our colleagues:

Chris ParsonsQ5 UKchris.parsons@q5partners.com

Rick DzavikQ5 USArick.dzavik@q5partners.com

Tom LearyQ5 Australiatom.leary@q5partners.com

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Cost Cutting – An Opportunity in Disguise?

Peter HorneQ5 Public Sector Leadpeter.horne@q5partners.com

Claire HamlinQ5 Change Enablement Leadclaire.hamlin@q5partners.com

The Benefits of a Great Employer Brand

Today’s war for talent is being won by talent. Increasingly, it’s not just about what your candidate can offer you, but what you can offer them. To attract the best people, whilst holding onto your most talented employees, you need to know what it is that makes your organisation unique, and why people want to come to work in the morning. In other words, you need to understand your ‘employer brand’.

You already have an employer brand, whether you are aware of it or not. It includes things like your culture and management style, the rewards and development opportunities you offer, and your image and values.

A clear benefit of a great employer brand is better recruitment and retention of talent, but our clients have also seen improvements in other areas, such as:

• Increased productivity as a result of improved continuity and stability

• Reduced HR costs, particularly internal recruitment and onboarding

• Strengthened brand – ‘standing out’ from competitors

HOW WE CAN HELP

Our team of consultants, based in London, New York and Sydney work with a huge range of organisations, across industry sectors. We have vast experience of helping clients evaluate, define and strengthen their employer brand – equipping them with bespoke tools and models that can be re-used for years to come.

To find out more about Q5, and how we can help, please contact:

TIPS ON WHERE TO START

What makes you different?Consider your organisation as a whole and define what makes it different to anywhere else. Once you’ve done this, it’s easier

to assess whether your employer brand is reflected through each of your employee touchpoints – like your website, the interview experience and first day.

Do your organisation’s purpose, values and employer brand align?Your employer brand and organisation brand should form a virtuous circle and

complement each other. The more aligned and engaged your workforce, the better your service will be.

What do people love about working for you?Your employer brand needs to be driven by authenticity, so engage everyone across

your organisation and ask them what it is that they love about working there. Take care to ensure that you have ways of absorbing feedback and that you are in control of your key message.

Who will be responsible for owning your employer brand?Agree within your organisation who owns the responsibility for your employer brand

– be it the Senior Leadership Team, HR, Marketing, or anyone else.