Fit for the future
The changed framework conditions prevailing in the energy industry require strict budgetary discipline with future investments and a reduction in running costs. During the coming years, we will only be able to implement a few important projects, particularly in the area of electricity generation. This means that jobs will be lost in those areas affected. Our primary aim is to address this situation through more flexibility from our employees. However, we also need to implement job reductions over the coming years. We are planning to cut 3,700 jobs during the years 2013 and 2014. In view of the changes we have described, we will continue to reduce the number of people employed during the course of 2014.
Employee relations in the context of restructuring
We do not want to operate a top-down approach for implementation of the challenges described. Our aim is to join forces with employee representatives and structure the journey to increased efficiency with socially acceptable conditions.
On 11 July 2012, RWE provided official notification to employee representatives in Germany about the plans covered by the ‘RWE 2015’ project. The presentation to the Group Business Committee (GBC) and the Group Works Council (GWC) initiated the involvement of the co-determination committees in accordance with statutory regulations. This had been preceded by discussions on an informal basis.
Cultural change with RWE 2015
‘RWE 2015’ is not simply a programme for cost cutting. ‘RWE 2015’ entails much more of a broadly based approach and comprises four areas for action. An important area for action is implementation of a cultural change in the RWE Group. This is intended to support development towards a stronger performance culture. The continuous improvement of processes, structures and workflows should not take place in one-off projects but should be structured as a continuous process in the course of day-to-day, routine business.
If we are to develop into a high-performance organisation, all the players in the Group need to fully understand the need for these changes and they have to make a commitment to them. As far as we are concerned, this entails having an open attitude to new processes or different working methods. We also need to enhance our focus on customers, the market and our competitors and promote our commitment to performance. This approach will only succeed on the basis of motivation and trust. Our corporate strategy will need to be clearly communicated to the Group companies and our employees will need to be informed of the contributions they can and should make to the process of implementation. This communication requires clarity and transparency in leadership style.
However, a survey of around 300 managers carried out in spring 2012 highlighted concerns about managers’ readiness to embrace change. The Organisational Health Index (OHI) was used to survey around 90 individual categories and skills. This index indicated that the majority of managers were aware of the necessity to make changes. However, there are uncertainties surrounding implementation of the changes. These changes are not simply about issuing instructions. They have to be introduced by the individual supervisors who have an important part to play as a role model. We are working on this issue.
Despite the changes occurring in the energy industry and the resulting consequences for RWE, the goals for the personnel strategy remain:
- Activation of employees with the aim of structuring the change together
- Establishment of a performance culture throughout the Group
- Enhancing productivity and efficiency in existing and new areas of business
- Sustainable business success through staff with the right talents
- Dedication and commitment of managers to leadership
These goals will generate new measures focused on the current changes. They will be integrated in the ‘RWE 2015’ programme and implemented within the programme.
Internal Group Job Market
The Internal Group Job Market (IGJM) is intended to promote the mobility of our employees across company, interdisciplinary and national boundaries. The objective is to create an internal job market that presents attractive options to employees who are looking for new challenges. It is also hoped that a bigger and more transparent range of job offers will also enhance the appeal of RWE as an employer. Employees wanting to embark on new challenges will be approached selectively through a professional intermediary network. The IGJM creates transparency for the personnel requirement and the imbalances based on changes in the energy market. It supports personnel management in solving employment problems.
Implementation of the IGJM started in January 2011 and has been successfully implemented in German companies. In 2012, an online tool was also developed and introduced (IGJM: one:n) in which employees can input their interests and skills, and test themselves. On this basis, the employee can then get advice on how their career could develop further.
Comparable pay structures
We have decided to make the pay for our non-pay-scale employees more transparent and more accountable. This will make it easier for employees to change positions within the company. In 2012, we embarked on drawing up an objective and transparent classification of non-payscale functions and restructuring the non-payscale groups in order to harmonise the classification and pay structures of non-payscale employees throughout Germany. The HAY System was selected for assessing functions since this methodology has already been used in the RWE Group since 2004 for evaluating management functions within Germany and in some foreign subsidiary companies also for non-management functions. RWE AG and RWE Innogy were the pilot companies and we worked together with the co-determination committees to assess the non-payscale function. The non-pay-scale structures established in this pilot study will form the platform for drawing up a uniform structure for classification of the non-pay-scale functions and the pay structures for all German companies by 2014.
Every employee needs to be aware of the targets that have to be achieved and precisely what his or her position is. In order to achieve this, we require honest feedback and a nuanced assessment of performance. ‘RWE 2015’ is therefore currently being used for a review to make the performance processes transparent and uniform for all the employees in the Group. The objective is to create a challenging and supportive performance culture which yields differentiated results and leads to consistent follow-up measures.