1. Managing Key Human Resources: Setting Objectives for Teams and Delivering Results Dr. Roger Darby Centre for Defence Management & Leadership Cranfield University, UK Defence Academy of the United Kingdom

2. Minister’s Vision 2013-14 “….sets the defence priorities for the Ministry of Defence (MoD) for 2013-14. The document provides a clear vision for further development for the GAF to improve its capabilities to protect the independence, territorial integrity and sovereignty of Georgia, to participate in international operations and assist civil authorities during natural and man-made disasters. Our goal is to create a highly-capable, mobile, modern, fully-professional armed forces that is fully interoperable with NATO. The reforms that are planned to achieve this goal will be in line with the recommendations of the SDR 2013 that defines main directions to shape the armed force development and its final structure – Objective Force 2016.” Guiding principles: Using personnel and external expertise effectively Exploiting institutional memory and experience Encouraging innovative approaches Decentralizing the decision-making process Promoting teamwork across military and civilian structures Ensuring a consistency of purpose Vision = organisation’s desired situation Its purpose is to guide, control and challenge the entire organisation toward realising a shared concept of the organisation in the future.

3. Managing the Defence ‘Spaces’: The Battle Space the Business Space & Civil Military Relations… Business space Preparation of defence capability Protracted time Resource constrained Assembling people, equipment, training etc Civil Military Relations * Cyberspace ? Battlespace Operational area Short time for decisions Less resource constrained Using people and equipment, within the constraints of the preparations made )

4. Managing Resources to meet Strategic Needs RESOURCES - tangible & intangible Finance – PEOPLE - Plant/M/c - Technology CAPABILITIES – to deploy resources to meet objectives CAPACITY – sufficient social capital to meet requirements - COMPETENCIES (CORE) - Capacity Building…

5. THE HUMAN RESOURCE CYCLE Selection Performance Appraisal Training Rewards

6. ‘CONTRACTS’ – and the Employment Relationship Employee and employer perspectives matter – because managers’ & employees’ behaviour is influenced by their beliefs……….. HRM & CONTRACTS 2 MAIN TYPES: 1.EMPLOYMENT CONTRACT – Legally binding – WRITTEN 2. PSYCHOLOGICAL CONTRACT - UNWRITTEN - (Military Covenant?) “an implicit exchange between an individual and his organisation which specifies what each expects to give and receive from each other in the relationship.” “the perceptions of both parties to the employment relationship, organisation and individual, of the obligations of implied in the relationship. Psychological contracting is the process whereby these perceptions are arrived at.” -Development of the ‘individualism of the employment relationship’ The concept of negotiated exchange at the individual level offers distinct parallels with the traditional pluralist exchange of collective bargaining

7. Decisive - The Military Covenant Valued By The Nation Just Reward Valuing Our People Valued by the Nation Fair Treatment Terms and Conditions of Service Fighting Spirit Valued by the Service The Soldier

8. Fighting Spirit The Military Covenant “Do my job and be valued” “Being able to enjoy my life” “Look after my family – whatever happens to me”

9. Reward Management “What gets rewarded, gets done…..” is the key that REWARDS reflect what the organisation see as important.. Important determinants: Question of ‘QUANTITY’ (i.e. reward must relate to number of items produced) V ‘QUALITY’ (i.e. reward may reflect reject rates or customer satisfaction rate) ‘PAY +’ = KEY HRM ISSUE…!

10. Ministry of Defence Minister of Defence Various state departments Lands; retired personnel; Finance; acquisition Support organisations: inspectorate; analytic support; intelligence; press services 1 st Deputy minister Deputy minister General Staff Armed Forces Military policy & strategic planning International cooperation Personnel Education & Science Humanitarian Healthcare Citizens’ petition Sports Oversight Labour Economic & administrative Construction Munitions Armaments Materials Technical Industrial Environment Administration Legal Supervision Information Accounts

11. Armed Forces General Staff (MoD) Main Command Centre Support Forces Command Joint Operational Command Land Forces Command Air Forces Command Naval Forces Command Western SouthernNorth Army Corps Directorate Air Forces Command Directorate Naval Operations Centre Coastal Defence Troops Formations Armed Forces Peacekeepers Formations Land Formations Air Forces Formations Naval Stand-by Forces (Supply Functions)

12. So, where does money fit in?

13. OBJECTIVES OF A REWARD SYSTEM ENCOURAGE BEHAVIOUR THAT ENABLES THE ORGANISATION TO ACHIEVE ITS GOALS AND ATTAIN COMPETITIVE ADVANTAGE ATTRACT SUITABLE CANDIDATES RETAIN AND MOTIVATE CURRENT EMPLOYEES ACHIEVE ITS ENDS AT AN ACCEPTABLE COST ENABLE FLEXIBILITY AND INNOVATION

14. Seven deadly sins that put reward strategies at risk The seven reward risk groups How the risk arisesPotential consequences Strategic Misalignment of reward strategy To the organisation’s goals An inability to attract and retain the employees needed for success Behavioural Misalignment of reward strategy to the required employee behaviours The rewarding of inappropriate or unproductive organisational activity or behaviour Financial Inadequate reward cost managementPoor value for money and, where relevant lower profitability or even loss Operational Poor execution or failure of reward systems and reward processes Inefficiency or inaccuracy of the systems or fraud in their operation Implementation and change management Poor implementation or change to the reward strategy and/or processes Reward is managed ineffectively and therefore does not have the required impact Legal and ethical Non compliance with organisational and societal values and legal and regulatory reward requirements Employee claims or regulatory action that can affect an organisation’s financial healthy and its reputation Governance Inadequate oversight and challenge to organisational reward strategy Organisation pursues inappropriate policies

15. MOTIVATION: PROCESS THEORIES Expectancy Theory: Equity Theories: Goal Theories: Behaviour depends on the outcomes that an individual values and the expectation that a particular type of behaviour will lead to those outcomes Behaviour is affected by different levels of reward for the same amount of effort Behaviour is affected by goals which are determined by the individual’s values and wants

16. REWARD MANAGEMENT Economic (Extrinsic) Rewards Social Relationships Intrinsic Rewards Overlap = Needs and Expectations in the workplace

17. Components of the Reward Package l Security Base pay Pay for performance Performance Related pay Commission Recognition pay Benefits Skills - based pay Competence Based pay Fixed benefits Career development Incentive schemes Direct rewards Extrinsic Job satisfaction Cultural satisfaction Indirect rewards Intrinsic Total Reward Personal growth Flexible benefits

18. TYPES OF REWARD Group-related Security-driven: Lifetime jobs Corporate prestige Tradition-driven: Cost of living increases Perks Employability-driven: Training and development Personal career plans Contribution-driven: Performance-related pay Merit bonus Individual-related Money- related Non-Money related

19. PAYING PEOPLE RIGHT? 1.Create a positive and ‘natural’ reward experience 2.Align rewards with business goals to create ‘a win-win partnership’ 3.Extend people’s ‘line of sight’ between effort and outcome, motivating ‘smart’ working over simply expending extra effort 4.Integrate rewards with strategic aims and kinds of contribution desired 5.Reward individual ongoing (input) value to the organisation with base pay 6.Reward results (outputs with variable pay ‘Involve and educate’ the workforce about the reasons and shared benefits for changing reward systems Provide a clear managerial direction that individual employees must continue to ‘add value’, which the company will recognise with rewards Ensure that all members of the workforce are ‘knowledgeable stakeholders’: they are to be shown how their efforts impact on the work team, business unit and company, including the need to adapt to customer needs Use each ‘reward tool’ for what it does best, integrating each element of total reward to offer a customised ‘deal’ This has three elements: employee salary is to reflect increases in competencies the firm finds useful; consistent performance over time; and the individual’s value in the external labour market It is uncritically accepted that the firm ‘must meet shareholders expectations’ (whose reasonableness relative to other stakeholders is not discussed); variable pay is deemed suitable as part of the ‘total reward’ offer to reward these ‘results’, as well as enjoining employees in the corporate project Principle Comments

20. TO BE SUCCESSFUL REWARD SYSTEMS MUST… BE IN LINE WITH ORG. VALUES AND CULTURE FIT WITH ORG. STRATEGY INTEGRATE WITH OTHER HR STRATEGIES REWARD RESULTS AND BEHAVIOUR BE PRACTICABLE AND EASY TO IMPLEMENT EVOLVE THROUGH CONSULTATION BE CONSISTENT WITH MARKET RATES

22. Performance Management & SSM 1.What is your experience of performance management in SSM? 2.What is your knowledge of performance management in SSM? 3.What issues does Georgia’s SSM face introducing performance management?

24. Potential Issues Definitions Challenges to instituting sustained SSR Transparency & accountability – not taken seriously Two clients/customers – donor & recipient Self assessment – interpretation of question areas Taxonomy – one size fits all?

25. Individual performance Looking back Looking externally Looking forward Perception data Collective performance Looking internally Hard facts The Measurement Compass: 8 directions : - Need to take account of: - Look forward as well as looking backwards - Measure of collective as well as individual performance - External measure as well as internal measures - Perception data as well as hard facts

26. Definition How would you define performance measurement? “Performance measurement is evaluating how well organizations are managed and their value they deliver for customers and other stakeholders.” Max Moulin “The process of quantifying the efficiency and effectiveness of past action” Adams, Kennerley & Neely Why Measure? 3 distinctive roles of measurement: Comply Check Challenge

27. Neely - 4 CPs of Measurement Check Position Communicate Position Confirm Priorities Compel Progress

28. How Could this be Adapted for General Use? ObjectiveTop Level MeasuresSub Measures ReputationFeeling of security by population Trust in Security Sector Organisations Trust in Armed Groups Trust in Judiciary System AccountabilityIncreased oversightFighting corruption & nepotism Ombudsman for complaints Independent scrutiny Reform of Security Services Support for Security Sector Reform Improve training of police & security forces Trial of security personnel responsible for violations

32. Balanced Scorecard Performance Management Tools & Techniques Capability Reviews UN, Country & Regional Models Performance Measurement Theories, Definitions Methodologies Excellence Models SSMSSM Other Models

33. HUMAN CAPITAL CHECKLIST Align human capital programmes with overall org. strategy – (HRM linked to Strategic Planning) Evaluate the current worth of your human resources and the efficiency of your current human capital functions and programmes – (Skills Audit) Measure the amount of funds and time you are spending to source, develop, and manage these resources – (Useful Metrics) Assess the return on investment in human capital – (ROI measures) Manage and minimise the risks associated with the employment of people - the least predictable of all assets – (Risk Mgt.) Maximise the value of human capital - the most valuable of all assets! – (Recognise Value of HR Services)

35. 35 Setting Objectives Strategic Management Process Internal Assessment Environmental Analysis Strategy Formulation (Planning) Strategy Implementation Strategic Control

36. Strategic Defence Review Current organisation of the Armed Forces Current Capabilities Capability Gaps Internal Assessment Required capability Aims of military security State Capabilities for support of Defence Threat assessment Environmental Analysis Policy Making Definition of priorities Management Strategy

37. Stage 1: Determine the Vision Minister’s Vision 2013-14 “….sets the defence priorities for the Ministry of Defence (MoD) for 2013-14. The document provides a clear vision for further development for the GAF to improve its capabilities to protect the independence, territorial integrity and sovereignty of Georgia, to participate in international operations and assist civil authorities during natural and man-made disasters. Our goal is to create a highly-capable, mobile, modern, fully-professional armed forces that is fully interoperable with NATO. The reforms that are planned to achieve this goal will be in line with the recommendations of the SDR 2013 that defines main directions to shape the armed force development and its final structure – Objective Force 2016.” Guiding principles: Using personnel and external expertise effectively Exploiting institutional memory and experience Encouraging innovative approaches Decentralizing the decision-making process Promoting teamwork across military and civilian structures Ensuring a consistency of purpose

38. Stage 2: analyse vision according to 4 perspectives BALANCED SCORECARD Measures Targets Initiatives Objectives Resources Efficiency/ Effectiveness Role/Purpose Capacity Building

39. Four Questions to Ask Requirements as defined by policy What is our purpose? What do we need to do to achieve our purpose? What do we need in order to do that? What do we need for the future? Role Efficiency & effectiveness Resources Capacity building

40. Four Questions to Ask Main Defence Forces What is our purpose? What do we need to do? What do we need, to do it? What do we need for the future? Defend against major aggression; Defeat the enemy in a local war; Force … an armistice… Combat & mobilisation readiness (90-120 days) Effective forces Effective command and control bodies Personnel at 70% of required strength Provision of weapons & equipment, State support Develop Command & Control system Logistics support Improve personnel policy Improve civil-military relations

41. Stage 3: express vision as strategic aims BALANCED SCORECARD Resources Efficiency/ Effectiveness Role/Purpose Capacity Building

42. Future (Capability Building) Are we building for the future? e.g. Defence Balanced Scorecard 2008-12> - UK MoD Purpose (Role) Are we fit for today’s challenges and ready for tomorrow’s tasks Resources Are we making best use of our resources? Enabling Processes (Efficiency & effectiveness) Are we a high performing organisation? Defending the United Kingdom and its interests; Strengthening international peace and stability; Acting as a force for good in the world

43. UK Defence Scorecard in more detail Purpose (Role) A.Current Operations: Succeed in Operations and Military Tasks today. B.Future Operations: Be ready for the tasks of tomorrow. C.Policy: work with allies, other governments and multilateral institutions to provide a security framework that matches new threats and instabilities Resources D.People: Manage our people to provide sufficient, capable and motivated Service and civilian personnel.. E.Finance and Value for Money: Maximise our outputs within allocated financial resources. F.Estate: Maintain and develop estate infrastructure of the right capability and quality.

44. Enabling Processes (Efficiency & effectiveness) G.Military Equipment Procurement: Equip and support our Armed Forces for operations now and in the future. H.Infrastructure Procurement: Invest in strategic infrastructure to support defence outputs. I.Security & Business Continuity: Enable secure and resilient operational capability.. J.Safety: Minimise non-combat fatalities and injuries. K.Reputation: Maintain our reputation amongst our own people and externally L.Sustainable Development: Work with other government departments to contribute to the Government’s wider agenda, including sustainable development. Future (Capability Building) M.Future Capabilities: Develop the capabilities required to meet the tasks of tomorrow.. N.Change: Develop flexible and efficient organisations, processes and behaviour to support the Armed Forces. O.Future Personnel: Deliver the personnel plans to meet the needs of current and future tasks

45. Stage4: Determine … What are the critical success factors for achieving strategic goals? What are the critical measures that indicate strategic direction? What actions should we take? Helps us to determine our priorities. What are the standards that we need to achieve? The beginning of the action plan. 45

46. A UK Example: Resources D.People: Manage our people to provide sufficient, capable and motivated Service and civilian personnel. E.Finance and Value for Money: Maximise our outputs within allocated financial resources. F.Estate: Maintain and develop estate infrastructure of the right capability and quality. The vision: Defending the United Kingdom and its interests: acting as a force for good in the world…

47. People: Critical success factors Ensure we have sufficient diverse people, maintaining manning balance and the right profile of skills within each service and the right mix of skills in the civilian workforce despite reducing numbers, Ensure our people are capable of doing the jobs we need them to do by keeping them healthy and training them well, Manage our people well, motivating them and offering them worthwhile can satisfying careers.

48. Manning Balance: Critical Measures End of financial year: 2008/092009/102010/112011/12 Royal Navy/ Royal Marines 35,79035,41035,36035,380 Army101,660101,630100,560101,510 Royal Air Force 40,83040,36040,67040,170

49. Step 5: Cascade targets through the chain of command Achieve full manning balance in each of the 3 services as soon as possible by: Achieving overall Service manning balance (+1% to -2%) between the trained strength and the trained liability. Maintain the correct profile of skills and experience within the regular Service manpower structures Improve longer-term recruiting prospects by increasing the representation of minority ethnic groups within the Armed Forces. Delivery responsibility: Chiefs of Naval, General and Air Staff.

50. Step 6 Consider your goals as the foundation for a control and reporting process …

51. Resource Management Budget Manning Level Estate Reputation Reporting Performance (Example) Output/Deliverables Operations Effectiveness Policy Process Improvement Training Logistics Support Acquisition Outputs Learning and Development Investing in people Lessons learned Information Technolog y =satisfactory =minor weakness =serious weakness =critical weakness

52. 52 Value & Potential of the Scorecard Approach A simpler, clearer statement of the strategic intent of the Defence Council & Defence Management Board A more comprehensive view of performance A clear focus on outputs An insight into how the components of performance relate to each other & to the delivery of our key outputs

53. 53 Performance Management Benefits Simplified strategic goals Fewer, more strategic, performance targets Better information on performance Integration of financial and non- financial reporting Sharper focus on results

54. CONCLUSION.