Keeping HR simple at Toyota
Jenny Roper, September 26, 2016
Toyota HRD Rob Giles hates overcomplication, especially in HR. Here's how he uses a 'no fixed specialism' approach
Entering HR for the first time in 2008, Rob Giles nearly turned around and walked straight back out again. It was a certain high-profile conference – which shall remain nameless – that very nearly prompted his change of heart: “I decided I’d better immerse myself in the world of HR so I went to this conference. And it frightened the life out of me. I came back and said ‘can I change my mind?’”
Fortunately for Toyota GB, where Giles has worked for nearly 25 years, he decided to stick with it. For the now director of HR, corporate planning, CSR and legal, quickly recognised that the kind of HR he’d witnessed early on wasn’t the only way.
“It was people talking about stuff [at the conference] that I thought if the business heard they’d say ‘what are you talking about?’ It wasn’t grounded in: fundamentally what is it that’s going to make the difference around here? I think people were overcomplicating things with lots of technical jargon,” he says.
Not that Giles took the decision to move into HR lightly. “When they came to me and said ‘you’d be good in this role, you’ve done a lot around the development piece, you’re naturally good with people’, I was a little unsure about moving into what could be deemed a specialist area. But I’ve tried to keep it quite simple.”
Keeping things simple has been at the heart of everything Giles has done in what could be described as something of a dual HQ and dealer network role. His first experiences of ‘the people side of things’, and how powerful concentrating energies here could be, came courtesy of his move to head office in 1999 as franchise representation manager, dealer development. Toyota GB is a lot smaller than you might realise. Only those 320 people sitting at Toyota’s new, state of the art, eco head office in Epsom, Surrey are employed directly; the other 6,000 staff members are employed by the 180 Toyota Centres and 45 Lexus Centres that make up the brand’s dealer network.
Giles’ task when he became franchise representation manager, and a large part of his role today, is ensuring great customer service through these 6,000 quasi-employees.
“I was very involved in the showroom concept,” recalls Giles of his franchise representation manager role. “My brief was: can we make the showrooms look great? I started on that journey and quickly realised this was all going to look lovely but unless the people in the showroom were delivering the right experience it was going to be nonsense.” Giles’ solution was taking salespeople off the showroom floor, putting them into sales offices and introducing ‘hosts’, tasked purely with making customers feel welcome. Salespeople hated it at first but soon came round to realising it was the more effective way to make a sale long term, he says.
From there, Giles’ conviction of the value of strong people strategies, and a much more people-orientated career trajectory, were set in motion. After a spell in marketing he became general manager of corporate planning and CSR; and when the 2008/9 recession hit he was tasked with looking at where the business could streamline and find efficiencies.
Again the power of focusing on improving Toyota GB’s people proposition quickly became clear. “When the recession hit, a lot of companies cut their training budgets – we increased ours. We had to make headcount cuts, but the big focus for us was around increasing capability,” says Giles. “The market shrunk massively and the only way was to grow our way back out. We had to fight hard for market share. We had to be better than competitors by making sure the quality of people was there.”
Giles was already so involved with OD and training initiatives that he was the natural choice when Toyota GB’s then-HRD left. But he is by no means an anomaly in heading up an area of specialism he has no formal training or background in. For at Toyota GB there’s no such thing as a set-in-stone specialism.
“We want fresh eyes looking at parts of the business that otherwise are being looked after by people who are a bit blinkered and have been there for a long time,” explains Giles. “We move people quite regularly, and we move them into areas they’re not necessarily familiar with so they can ask lots of challenging questions… Even in finance you might have a financial officer who hasn’t always been in that function.”
Of the way this works for the senior leadership team, Giles adds: “It’s interesting because when people come into the team they sit back and say ‘I’m not sure who the sales director is, who the HR director is, because you’re all talking about every aspect of the business.’ We set that expectation out very clearly. You are expected to get involved in things outside your area.”
He adds: “It’s not always me at a senior management meeting, for example, talking about HR stuff. We’ll get one of the other directors to stand up and talk about it. It shows we all buy into it; it’s not an HR thing.”
This no fixed specialism approach lower down the organisation is the opposite of the ‘quick-fix’ of looking externally when a vacancy comes up, explains Giles. “It’s quite an intense process. It means that, for example, one part of the business might take the whole day to talk about people in their division. They literally talk person by person, role by role.” But it’s worth it, he says.
Of course, such conversations will never work unless managers are well-versed in what each of their employees might fancy having a go at next. Critical to this approach is Toyota GB’s management deal, which replaces the annual appraisal system with quarterly conversations and, crucially, involves two lots of training: one for managers and one for those being managed.
“It was about making sure people were skilled in how to have a powerful conversation,” explains Giles. “It’s called ‘deal’ because it’s two way. While the manager has a very strong role, you [the person being managed] have also got a responsibility. People now feel they have the permission to challenge their manager, to say ‘I’m not getting the coaching I need from you’.”
Permission to challenge and look at things with fresh eyes is very much at the heart of Toyota GB’s relatively recently revamped ‘Collective Ambition’, formulated in 2014 after the brand entered The Sunday Times’ 100 Best Companies to Work For survey and was told, although it was ‘one to watch’, the business wasn’t customer-centric enough and employees were unclear of their exact purpose. “So we set out our purpose and vision and it was all centred around customers and people. We said every day should be about doing business the way customers want us to – simple,” says Giles.
In an increasingly online world, and a retail environment of ever higher customer expectations, it’s as vital those 320 employees sat at HQ are as customer-orientated as their dealer network counterparts. Here the emphasis is on recruiting a slightly different mindset to the one of old. “Now, because of digital, customers are interacting with us for a big proportion of their buying and ownership journey,” explains Giles. “Whereas customers used to go into dealerships maybe two to three times during their research phase, now it’s all done digitally and with us directly. So our people skills have got to change and the way that we think has got to be different.”
The company has recently launched a ‘Consumer One’ division: a rapid prototyping, customer – and mostly digital – innovation division. A notable success of this new approach so far has been the MyToyota app. Whereas previously when a customer bought a car they then didn’t hear from Toyota for several weeks, updates on manufacturing and delivery progress are now provided through the app. “We can also ask ‘what radio stations do you want us to programme?’ The owner’s manual can be loaded up. So it’s making things as easy as possible, and engaging,” adds Giles.
Getting staff to embrace this new, more customer-orientated way of working is about recognising that the old way had its flaws, says Giles. “From Toyota’s perspective it’s quite a big change because we’re a company that does 80% planning, 20% doing. We’ve got to do that and we shouldn’t lose that, but we’ve got to do things in a much more dynamic, rapid way. The big change is ‘don’t be frightened by mistakes’.”
Providing a great experience when a customer walks into one of Toyota’s franchised dealers is perhaps a more complicated, and unique, challenge than where direct employees are concerned. For Giles, treating these individuals very much as Toyota GB staff well worth investing in has been key.
Though the typically high staff turnover of a dealer network can mean “you sometimes feel like you’re training and training and training, with new people coming in all the time”, Giles has been dogged in the importance of investing in training. Hence the establishment of a new £2 million state-of-the-art training facility at one of Toyota’s manufacturing plants (owned, like all Toyota and Lexus manufacturing, by a separate company). The idea is for the experience to be doubly inspiring through dealer employees seeing the sophisticated production lines behind the cars they sell.
Remuneration policies that discourage salespeople from hopping between brands, depending on who has a new product or seems to be selling better at any given time, have also been key to improving both customer and employee experience. “We’re doing a lot to try to encourage the dealer network to improve retention,” Giles explains. “A lot of that is simple things around salary packages; not necessarily paying loads more but structuring basic pay a bit more. Then it’s things like do you have loyalty bonuses, do you reward people that get to certain levels of training?”
He adds: “We don’t own our dealers so it makes our model doubly hard. It’s our responsibility to drive change through the dealer network and set the standards we expect. We’ve been making it clear the only way they can drive their performance is through strong effective people.”
Setting this newly clarified customer-centric vision again required a high degree of honesty about what had gone before, says Giles. “We wanted to be the best dealers in town driven by highly engaged people. To do that we had to draw a line in the sand and say ‘that’s what was, this is what is’.”
“Part of that was describing what went before,” he adds. “We played people examples where we got the dealer network to record stories of where we were not doing things that were customer-focused. A few people got quite angry and defensive because they didn’t like to hear this negativity.”
So has all the hard work been worth it? The company’s entrance this year into The Sunday Times’ 100 Best UK Companies to Work For ranking would certainly suggest so. The organisation ranked ninth in terms of staff saying they feel proud to work for Toyota GB (89%).
And on his decision to go into HR, Giles has no regrets. “I was sceptical going in, but now I absolutely love it,” he says. It’s been a tough but rewarding gig – “My hair has gone a lot greyer,” he jokes. And for him the magic comes from the ability to truly make a difference. “You can make an advert and who really cares? Is it really affecting lives?” he muses. “But in HR you’re genuinely changing people’s lives.”