France Telecom Case Study 2- Human Resources Management Evolution

1. France Telecom Case Study2- Human Resources Management Evolution Workshop Aligning HR Case-study2- Human Resources management evolution

2. Key issues to be developed • Re-classification • Compensation & Benefits evolution • Appraisal • Career management • HRM centralization Workshop Aligning HR Case-study2- Human Resources management evolution

3. New issues of HR Management... • From one PTT administration towards a company.. • How to manage administrative personnel (public state rights) in coherence with private rights personnel in a competitive sector company ? • From a « qualification » approach towards a «competencies » logic • How to warrant employability in a perpetual evolution work environment ? • How to warrant the group performance combining individual and collective skills ? • How to warrant skills evolution? Workshop Aligning HR Case-study2- Human Resources management evolution

4. HR Management Evolution • This evolution was closely followed by a deep social reform that lead to a really coherent and innovative HR management policy which had to conform to the civil servant rules. The key issue of this new management : Re-reclassification (from a grade to a function logic) Workshop Aligning HR Case-study2- Human Resources management evolution

5. Re-classificationFrom grades to classification • Objectives and principles : • Identify all functions in place in the organization • Facilitate coherence between functions and professional qualifications • Recognize the value of professional experience acquired during the career and through promotion • The different steps : • Identify key functions (~130) which cover all fulfilled functions • Position these functions with an appropriate rating scale • Design evaluation and weighting tool • Use this tool to fix all functions on levels that will build the new Human Resources grid Workshop Aligning HR Case-study2- Human Resources management evolution

6. Re-classificationFunction levels • 15 function levels identified and organized in 4 classes • Class I corresponds to the functions of specialized agents without required diploma (3 sub-levels) • Class II groups the functions of professional and master agents (3 sub-levels) • Class III corresponds to the Operational Managers (3 sub-levels) • Class IV corresponds to Executive Managers (6 sub-levels) Workshop Aligning HR Case-study2- Human Resources management evolution

7. lev 1 220 to 332 over 16 yrs 379 to 904 in 13 yrs 298 to 544 in 18 yrs 3230 to 638 in 14 yrs lev 1 lev 1 lev 1 lev 2 427 to 966 in 15 yrs lev 2 lev 2 384 to 592 in 16 yrs 238 to 365 over 16 yrs 379 to 735 in 13 yrs lev 2 lev3 274 to 474 over 17 yrs lev 3 425 to 638 in 12 yrs Lev 3 Lev 3 440 to 841 in 15 yrs Lev 6 Re-classificationFunction levels Recruiting mode Class I : specialized agents Recruiting : without any diploma Class II : professional agents and masters Recruiting : A-level 500 grades Class III : Exploitation and management executives Recruiting : bachelor Class IV : Top executives Recruiting : master of engineering Workshop Aligning HR Case-study2- Human Resources management evolution

8. Lev 1 Lev 1 Lev 1 Lev 1 Lev 2 Lev 2 Lev 2 Lev 2 Lev 3 Lev 3 Lev 3 Lev 3 Lev 6 Re-classification : Example of positioning the key functions Class I Internal Mail selection and distribution Employee Publishing Employee, Company driver, Delivery Employee, Clerk, .. Car repairer, CCL Agent, Disturbed service Agent,.. Class II General affairs employee, technical supervisor, commercial adviser Outside plant designer, Operational Unit Supervisor, R&D secretary,.. Line construction team leader, trainer, technician Class III Research assistant, Team Leader, analyst in computer centre Car repair Unit Chief, Head of sales front line Sales executive, Junior engineer, responsible of network conception Class IV HR Adviser, General Affairs manager Information System manager, Switching manager Operational Unit manager, Department manager (Regional Headquarter) CNET Consultant Workshop Aligning HR Case-study2- Human Resources management evolution

9. Re-classificationPositioning tool : weighting • Responsibility Criteria 35% • Management level 14 % • Responsability extend 10% • Impact 11% • Competence Criteria 28% • Experience skills 14% • Problem solving complexity 14% • Autonomy Criteria 22% • Relational Criteria 12% • Difficulty Criteria 3% Workshop Aligning HR Case-study2- Human Resources management evolution

10. Re-classificationCriteria and weighting degrees • Management level : • Degrees from 0 to 3000 persons • Relational Dimension : nature, frequency, quality of concerned people • Degrees : collection, analysis, simple restitution, with factual persuasion or no, for whom, for which purpose,... • Competencies – experience • Degrees : implies knowledge, know-how, how to behave, applied to one or various fields, acquired through experience or studies • Autonomy • Degrees : simple tasks, complex ones, with or without procedures to apply • Problem solving complexity : usual situation or not.. • Responsibilities extend : limited, concerned with others.. • Impact : with or without risks, recommendation needed,.. • Difficulty :physical, psychological, mental strain,.. Workshop Aligning HR Case-study2- Human Resources management evolution

11. Re-classificationJob post- function links • Objective : allowing the establishment of a link between an employee and a targeted function • Methodology • From occupied job posts and the link to a function, a proposal is made to every employee through a job description which includes: • The hierarchical connection • A structural position • A position in the classification grid • A corresponding salary scale • Internal promotion perspectives Workshop Aligning HR Case-study2- Human Resources management evolution

12. But also a Compensation & Benefits simplified system • How to go from a salary scale based on an administrative classification to an individual Comp&Bens system based on skills, performance and contribution to company results,…….. while preserving the public management type principles ? Workshop Aligning HR Case-study2- Human Resources management evolution

13. Before Global wages = Index-based salary + Post benefit (Information Systems, training,..) Grade benefit (technician, inspector, ...) Usage (due to previous situation : gas for car benefit while no usage of personal car...) Compensation evolution is connected only to the index evolution, as planned by the government Now Global base wages = Indice treatment + CFT (Complement France Télécom) CFT : individual benefit that includes all post and grade benefits and all or part of usage fee Compensation evolution is individualised Comp& Bens components Workshop Aligning HR Case-study2- Human Resources management evolution

14. Usage Grad benefit Post / activity benefit Index-based salary : index *index value Two systems compared Before : every variation of index value, index change,.. has a direct impact on the compensation Indice X Indice X Indice Y Management salary raise Augmentation valeur indice Augmentation d’indice Now : every variation of index value, of index change,…means a lower CFT with same level of Global Base Salary (SGB). SGB raise is a manager’s decision SGB CFT CFT CFT CFT Indice X Indice X Indice Y Workshop Aligning HR Case-study2- Human Resources management evolution

15. Other components of compensation • Variable part : individual compensation given in function of objectives achievement and for which the amount corresponds to a % of the annual base global salary • Participation : mandatory benefit for companies over 100 employees calculated from the provisioned amount on company annual benefits • « Intéressement » : amount given to every employee calculated from national and local parameters Workshop Aligning HR Case-study2- Human Resources management evolution

16. An Appraisal tool :the Progress Interview (PI) • Implementation of PI allows to: • Evaluate • Post activities and associated skills mastering • Fixed objectives achievement and performance • Employee potential capability • Fix objectives for the period to come • Raise needs in terms of skills development • Promote individual expectations • PI becomes a real management tool which also permits to: • Propose a compensation evolution • Propose a promotion for the employee • Gather evolution wishes in terms of career or propose them Workshop Aligning HR Case-study2- Human Resources management evolution

17. Conducting of Annual Employee Interview (PI) • A progressive implementation processA top-down approach, without any exception • Preliminary Preparation of those conducting the interviewsA face-to-face training session, complemented with a probationary period allowing HR Managers to master their facilitator’s role • Detailed information of those being assessedAn opportunityto put into practice the up-dated rules concerning internal communication (cascading dissemination, intensive use of the Intranet,listening practices and bottom-up information flows) • Conducting the annual interviewWith a strong will to eliminate any prejudice and in order to conciliate collective interest with individual expectations Workshop Aligning HR Case-study2- Human Resources management evolution

18. What also changed… • Recruiting methods • From a knowledge-based control in a formal competition to a recruitment process with CV (resume) selection + interview • Promotion • From automatic or on competition to a management proposition of Promotion through recognition of competencies (PRC) • Mobility • From a strictly personal wish to a geographic and/or functional mobility in line with job vacancies available or for the company interest.. • ...... Workshop Aligning HR Case-study2- Human Resources management evolution

19. Career evolution (1/2) • Career orientation complements the individual appraisal • In line with the Progress Interview and apart from any hierarchical constraint • Through the implementation of ad-hoc committees whose members are Heads of Operational Units or HQ Departments: • Already prepared to identify competency profiles- Aware of job vacancies in the concerned regional area and concrete opportunities for filling these posts - Able to design transitional scenarii for moving step by step from the current post to the target position Workshop Aligning HR Case-study2- Human Resources management evolution

20. Career evolution (2/2) Management of internal re-deployment is considered as a real process- In order to create a genuine employment market at the level of each regional areareflecting the diversity of job opportunities in compliance with the nationaland international Human Resources policy of the company. - Based on a clear identification of the responsibilities of the originatingand terminating branches of the organization,…..that should not be limitedneither to an excessive confidence in the employee’s goodwill, norto sub-contracting the HR Manager the whole re-deployment process- Recognizing the importance of eventual transitional situations for a smoothtransfer of know-how Workshop Aligning HR Case-study2- Human Resources management evolution

21. From a local HRM towards a « virtual » one« From the executive office to HRCC and Intranet »New upcome... • First level management (Group manager) becomes the first HR of his/her Group (team). • Unit HR Director becomes the support/expert of the group manager. • Usual actions of HR management are on the Intranet. Every employee becomes actor of his/her own management => Reduction of HR structure in the units • HRCC creation : HR platform (Call Center) to bring together resources providing support to several units Workshop Aligning HR Case-study2- Human Resources management evolution

22. HRCC : The HR Call Center Mission: Inform and assist the employees, managers and HR people in terms of decisions and management actions. Workshop Aligning HR Case-study2- Human Resources management evolution

23. Workflow example : leave management Workshop Aligning HR Case-study2- Human Resources management evolution

24. Workflow example : leave management Workshop Aligning HR Case-study2- Human Resources management evolution

25. HR Intranet : an example Workshop Aligning HR Case-study2- Human Resources management evolution

26. HR Intranet : an example Workshop Aligning HR Case-study2- Human Resources management evolution

27. E-Learning : an example Workshop Aligning HR Case-study2- Human Resources management evolution

28. E-Learning : an example Workshop Aligning HR Case-study2- Human Resources management evolution

29. Bibliography www.francetelecom.comJ-J Bertholus: Qui a ruiné France Telecom?Bernard MERK: Equipes RH acteurs de la str@tégieBruno SIRE: LIRHE, Note Nr 350 Workshop Aligning HR Case-study2- Human Resources management evolution