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Building an Organisational Culture of Flexibility

Hosted by: Mirvac

Benjamin Morris Co-Head of HR and General Manager Performance, Reward and HR Operations at Mirvac discusses the importance of building an organisational culture of flexibility to support diversity and well-being, and business success. ChapmanCG’s Managing Director, Paul Jury, asks Ben some in-depth questions delivering an information-packed podcast, complete with practical guides, for HR and business leaders in all industries.

Transcript of interview

Paul Jury ChapmanCG [PJ]: I’m Paul Jury, a managing director with ChapmanCG. We’re here to talk about the importance of building an organisational culture of flexibility to support diversity and well-being. I’m here today with Ben Morris, co-head of HR at Mirvac, who has introduced an award-winning flexibility programme across his organisation. Hi and welcome, Ben. Thanks for joining me today.

Benjamin Morris, Mirvac [BM]:  Thanks, Paul. Delighted to be here.

PJ: Ben, it’s actually great to pick up on one of the key themes that we discussed at the HR roundtable Mirvac co-hosted with ChapmanCG.

BM: Absolutely. Certainly a lot of interest in that roundtable, PJ. So, looking forward to discussing it in more detail today.

PJ: Ben, before we get started, please tell us a little about your role and the work you do at Mirvac.

BM: Sure. I’m the co-head of HR for Mirvac Group. For those people that don’t know Mirvac, we’re an Australian-owned, Australian-listed company. We’re one of the top 40 companies on the Australian Stock Exchange. As a property company, our purpose is to reimagine urban life. We play right across the various segments of the property sector.

We have a very well-regarded residential business: houses, apartments and land. We have a very successful office business which has some of the most premium office buildings in the country. We have a portfolio of industrial and logistics assets. They’re the sheds that people like Amazon are renting. And, of course, we have some of Australia’s best-known retail assets as well.

One of the things that differentiates Mirvac is our ability to add value right throughout the property value chain. Some developers, for example, develop but don’t build. Some builders might build but not develop. Some asset owners might do neither of those things and simply own and manage assets.

Mirvac has the ability to create assets right from the initial development. We can design, build, manage, and work with capital partners in respect of those assets. PJ, I might just add one thing to that.

PJ: Absolutely, Ben. Please do.

BM: PJ, one of the interesting things for me in my role, reflecting on that mix of assets and on that mix of what we do, is the diversity of employees that we have in order to deliver that.

We have a combination of white-collar workers that are based in our offices. We’ve got designers, architects. We’ve got construction workers who are out on site, and we’ve got people that are managing the facilities within the office buildings, the industrial assets and the retail assets that we own.

PJ: Thank you, Ben, for the overview. You have a very unique profile in that not many HR leaders has an accounting and legal background, which I know gives you a real advantage around the commercial side of Mirvac and also leading on the people front.

BM:  Yes, I often like to tell people that I saw the light, PJ, and jumped out of my former life as an accountant and a lawyer to come across to the HR world. But thoroughly enjoying it.

PJ: Ben, why do you think a culture of flexibility is important to organisations and the people who work for them?

BM: I think it’s important for a number of reasons. First of all, if we look at the nature of work today, the nature of how we live, how we work is very different and how we live is very different to what it was 30, 40 years ago. Yet, most of how we work has its roots in the Industrial Revolution. Participation in the workforce is very different now than what it was back then.

We now have a more equal, hopefully, participation of men and women. Responsibilities in terms of caring are very different. Not just caring for younger families, but also caring for elderly family members as well. I think most importantly, PJ, whether we like it or not, there’s now a blurring of the lines between work and home largely due to technology.

I think work is something that we used to come to. We used to clock on. We used to clock off. I think it’s no longer a place we go to, but it’s now a thing we do. So, when we reflect on the changing nature of work and home life, I think flexibility is key in order to make both of those things work. I think the second reason why flexibility is important is because it’s what our people want.

We ask our new joiners why they joined Mirvac. They give us a range of reasons. They talk about the brand and our product. They talk about our culture. They talk about our sustainability and our diversity credentials. But they talk about how we work. When we ask them what they mean by how we work, they often cite flexibility as one of those reasons.

So, people are joining Mirvac because of flexibility, which tells us that it is important to them. When we then measure our employee engagement, we can see that not only do our employees value flexibility, but those that have flexibility, are more likely to go above and beyond. Their engagement is several percentage points above those without flexibility. Therefore, their commitment, their discretionary effort, and their likelihood to be great brand ambassadors for Mirvac is higher because of flexibility.

Thirdly, I think flexibility is important in enabling and supporting our diversity and inclusion strategy. Because without flexibility, we can’t provide the kind of diversity and inclusion that we’re aspiring to. Fourthly, as a property company that aspires to be providing some of the best office buildings in Australia, our clients have progressive aspirations in respect of flexibility with their own workforces.

So, if Mirvac is to create a great employee experience for our clients for their workforces, we need to practice what we preach and get flexibility within our own workforce as well.

PJ: It’s good to hear some of the specifics in the Mirvac situation, Ben. From a business case perspective, or perhaps some of the reasons why you decided to introduce this new culture, it would be great to hear you elaborate on that.

BM: PJ, I think there are two key reasons why we needed to drive flexibility. The first one was that we had big ambitions in respect of our D&I strategy. In order to execute that, we needed to embrace flexibility. The second reason was around employee engagement. I’m delighted to tell you that for the second year in a row, Mirvac has employee engagement of 90%.

We use Willis Towers Watson as our provider, and at 90%, that’s above the global high-performing norm. So, there’s something special happening. We’ve got strong results in terms of our people’s understanding of our strategy, our purpose. We’ve got strong results in respect of values. We also have strong results in terms of our employee’s benefiting from flexibility.

But PJ, it wasn’t always like that. Coming out of the GFC, Mirvac had engagement scores, only as far back as 2012, that were in the mid-30s. So, you really need to go back to 2012 to understand why we embarked on this journey in respect of flexibility.

If we start with the principles around engagement, what we do know is that those companies with higher engagement, on average, have three times higher profit margins. They’ve got less incidents. They’ve got less absenteeism, and they’re able to attract and retain a broader cohort of employees. But at 37%, we needed to fix it.

So, we dug into the organisation to work out where the pockets of excellence were. What were those teams doing that were highly engaged? So that we could learn from that and roll that out across the broader organisation. There were three clear things for us. One, we needed to focus on building great leaders. Two, we needed to focus on career development and learning. Three, we needed to change how we worked, and specifically, we needed to embed greater flexibility.

That was really the start of this journey. We wanted to shift the focus from presentee-ism to being about output, and we wanted to embed flexibility to make people be able to thrive in their work environment.

PJ: We know Mirvac has been successful and the results impressive. They’re working for both your office-based employees as well as construction workers and the other field-based employees. Ben, how did you go about developing and evolving the programme?

BM: PJ, as I said in the introductory comments, we’ve got quite a diverse workforce. We’ve got white-collar workers based in offices. We’ve got facilities people based in office buildings and in our retail assets, and we’ve got people based on our construction sites. Whilst conventional wisdom might suggest that you might embrace flexibility and drive it initially in your white-collar office-based workers, we took the opposite view.

We thought that construction is a very traditional segment of our workforce. We thought if we can make it work there, then we can really make it work anywhere. We embarked on a number of initiatives, supported by a broader strategy that looked at people, process and place, which I can talk about in a moment. But what I thought I might do is just talk about three of these specific initiatives that we rolled out in the construction business that really helped us drive the desired change.

The first of those initiatives was something called the Equilibrium Man Challenge. The Equilibrium Challenge followed the lives of seven or eight men who wanted flexibility to make home and work and social life work better, but didn’t have flexibility. So, we followed these men around with cameras. Initially, the question was, what does flexibility look like to them? What’s important to them? How can we go about that?

Mirvac had two employees in the Equilibrium Man Challenge, along with a large telco and a large law firm. One of those employees from Mirvac was a site foreman and his dad was also in the construction industry. For this employee, he wanted to break the cycle of absentee fathers, fathers who worked very long hours on construction sites, worked a lot of over-time, often worked on weekends, and frankly, missed out watching their kids grow up.

That was his flexibility challenge. So, the documentary followed his journey as he had conversations with his manager and his team about what flexibility could look like for him, and his success achieved through that. The other Mirvac employee was Tom. Tom was an aspiring professional volleyball player. His challenge was, how does he hone a successful professional career as well as a successful sporting career? Of course, he needed flexibility to be able to make training.

What I love about this particular initiative is that, first of all, it mainstreams flexibility. It makes it so that it’s not just about working moms. It makes it so that it’s also about men. Thirdly, it’s not just about families. It could be anything to do with making work and life work better.

The second initiative was a series of workshops that we did that were really quite fun and creative. We got actors in to help these construction workers understand what the conversation might look like from a flexibility before [?]. Because of course, PJ, for you and me, in our roles and our careers, flexibility is probably a fairly normal thing.

But it was quite an alien concept for these construction workers. So, through these fun sessions, we were able to demonstrate to them that a conversation about flexibility isn’t nearly as scary as what it might seem, but also give managers some tools and tips on how to have that conversation with their employees and with their teams.

The third initiative, PJ, and this is absolutely my favourite, is an initiative called My Simple Thing, which has gone on to be an award-winning programme. What My Simple Thing does is it asks employees to think about, what is that one thing that if we can make it work or make it work better, will make the world of difference to how work and family and home life fit together? What is that one thing?

What I love about My Simple Thing is it starts a conversation. Because at the heart of flexibility, it’s not about a policy. It’s not about a contract saying that a role can be flexible. It’s about having an authentic conversation between a team, a manager, an employee about what flexibility means to them and how they can embrace flexibility.

PJ: Thank you, Ben, for sharing those real and practical and inspirational examples. In terms of the overall programme, are there any other key elements that make it work?

BM: PJ, there are three examples of initiatives within the construction business, but of course, sat under a broader strategy that we called Transforming the Way We Work. At the heart of our Transforming the Way We Work strategy was a focus on what we call the three P’s: people, place and process.

Because it’s no good just telling people that they can have a conversation about flexibility unless it genuinely is supported by a culture that supports flexibility, has leaders who can help their employees to embrace flexibility, as well as processes, physical place and technology that can all support flexibility.

I think one of the key things for us was the rolling out of what we call our Flexibility Charter. I think this stands out to me because it sets out principles for teams to follow, as opposed to black and white rules about what is or is not acceptable. In our Flexibility Charter, first of all we talk about two types of flexibility. We talk about both formal flexibility and informal flexibility.

Formal flexibility is where there might be a documented, pre-agreed series of days, hours or working patterns, where informal flexibility is the kind of flexibility that most employees like to embrace, which is the occasional day of work from home. It might be reduced hours on a particular day, or it might be working from some other location.

The second concept we talk about, in addition to flexibility in time… We talk about flexibility of time, place and careers. But what I recognised is that flexibility really means different things to different people, at different stages of their life, and at different stages of their career.

When we rolled out the Flexibility Charter, we made it really clear that it’s a principles-based approach, and I think we empowered people to have a conversation. We also empowered them to say no. We empowered them to say, this doesn’t work either for our team, or for our customer, or for the business. I think that’s really important.

At the heart of our Flexibility Charter are a series of principles, and these guide managers, employees and teams as to what flexibility looks like and helps facilitate a conversation about flexibility. Some of the principles, for example, are that we have a choice in where, when and how people work, supporting individual and business needs.

We communicate regularly on expected outputs and time frames to allow greater freedom on how we deliver. We utilise technology first and foremost to connect, collaborate and communicate. We work in a shared environment, and we adjust our actions and behaviours so we don’t impact on others. We empower and encourage each other to challenge behaviours that aren’t in the spirit of flexible working.

We don’t judge when people come and go, which, PJ, is incredibly important if you’re going to build a culture of flexibility. We like to say, no eyebrow-raising. Lastly, we aim to model flexibility for our people, our communities and our customers. I think these principles have really helped managers and employees to work out what flexibility means to each individual, but it’s also empowered those teams to make sure that flexibility works in the best interests of the business and our customers.

PJ: Ben, thanks for outlining they key elements, the charter and the principles. Fast forwarding to now, what have been the main benefits of your new flexible working approach? And also, how have you measured the impact?

BM: If we go back to where I started, PJ, we’ve now got an engagement score of 90% for the second year running. That’s gone up from 37% back in 2012. What we know is that in 2012, we really didn’t have any flexibility in our workforce. We had about one in five people saying that they had some form of flexibility. We’ve now got about three in every four people that say they’ve got some form of flexibility, whether it be formal or informal.

At the outset, what we do know is we’ve managed to embed flexibility into the way we work. I think more importantly though, the question is, how has that actually contributed to business success? How has that contributed to our broader people strategy? What we know when we ask people why they join is that flexibility and how we work is one of the key reasons why people are joining Mirvac today.

We know from our engagement survey results that those people with flexibility are more engaged, more likely to go above and beyond, and therefore, more likely to exert discretionary effort and be great brand ambassadors for Mirvac. Thirdly, what we know is that flexibility has been a key enabler of our diversity and inclusion strategy.

We’ve now received the Workplace Gender Equality Agency citation for the fifth year in a row. As you know, the bar is getting higher and higher for that citation every year. We believe that our flexibility strategy is a key enabler of that. We also know that flexibility has enabled us to meet out very high aspirations in respect of women in senior management and has enabled us to ensure things like a zero like-for-like pay gap for the third, and I think soon to be fourth, year in a row.

I think from a market point of view, PJ, we’ve been delighted to see that the work we’ve done in flexibility, including our initiative My Simple Thing, has been recognised by the Australian HR institute and is now an award-winning programme.

PJ: It’s great to hear about the recognitions and the achievements. What lessons have you learnt, and what advice would you give to other organisations, looking to implement a more flexible working culture?

BM: We’ve certainly learnt lots of lessons, PJ. When we first started on this journey, we didn’t get everything right. So, my first tip would be iterate as you go, be brave, experiment, but keep your finger on the pulse and be prepared to change things if they’re not working in your organisation. I’d also say be wary of the inflexibility trap. Because what I’ve often seen is that people try and drive flexibility through a series of policies and initiatives that are actually quite prescriptive.

The approach Mirvac has tried to take is very much a principle or a conversations-based approach. If you’re too prescriptive or have policies that are too detailed about what you can do or can’t do, then in my mind, your flexibility strategy can very quickly turn into an inflexibility strategy. So, just be really weary of that.

The next thing I’d say is, keep it simple. I think often we have a tendency as HR practitioners to overengineer the strategy and overengineer the execution of that strategy. What we’ve found worked really, really well is to focus on a smaller number of initiatives, do them simply, but do them really, really well. I think My Simple Thing is a really great example of that. It’s important in driving a culture of flexibility that it’s leader-led and role modelled.

In our flexibility charter, we talk about not having judgement about when people come and go. As soon as your leaders start making jokes, as soon as they start raining eyebrows or making comments when people might come and go at different times of the day, that will undo all the great work you’ve done in trying to drive a culture of flexibility. And to keep on top of that and make sure that your leaders are part of that change.

Talking about change, this is as much of a cultural change, about shifting from a culture of presenteeism to a culture of output, as it is about enabling that change through people, process and place. So, don’t overlook the challenges in driving any form of cultural change, and make sure you’ve got a plan to manage that over quite a long period of time.

PJ: Thanks for those insights, Ben, the advice and the lessons. Just thinking about your sector at the moment, universally, it’s facing some strong headwinds. How does flexibility assist you to navigate those changes in direction?

BM: PJ, indeed it is. For the Australian people listening to this podcast, they will know that you can’t pick up a newspaper at the moment without reading particularly about the residential market in Australia, but also about the retail market and the challenges that traditional landlords have from retail disruptors such as Amazon. For your overseas listeners, that context is really important.

I think for us, fundamentally, we need to make sure that throughout the property cycle, we have people that are committed to our purpose to reimagine urban life, that they understand our strategy, including through all parts of the cycle, and that we continue to live out Mirvac values through that cycle.

One of the things that we now know from our investors is that they see our culture, how we work, as a key source of competitive advantage. So, it’s important for us that right throughout that cycle, and through those headwinds that you mentioned, that we maintain that culture.

From our point of view, a culture of flexibility, a culture that embraces and enables diversity, is just as important through this next part of the property cycle as what it was as the cycle was on its way up. Certainly, for Mirvac, we’re going to continue to be very passionate supporters of flexibility and diversity in our workplace.

PJ: Ben, it’s very encouraging to hear that you’re making those adjustments but absolutely staying the course. More broadly, we’ve talked a lot about culture. Of course, in Australia, it’s also very topical. We’ve got the findings from the Royal Commission following through the whole issue around people versus profits. Ben, do you have any additional insights to share as you think about some of these challenges in the market?

BM: You’re right, PJ, absolutely topical, and not just for those companies in the financial services sector, but for all companies. I think that there are some key learnings from the Royal Commission and from the broader market sentiment. One of those is that we need a culture where people feel safe to speak up. We need a culture where we do the right things.

I think that organisations where the people passionately understand what the organisational strategy is, where they believe in what the purpose is, and where there are strong values around doing the right thing, are going to be those organisations that thrive in the current market.

I think one of the things coming out of the Royal Commission is, in particular, the need for boards and leaders to measure culture, that is, understand what the current culture is, to define the aspirational culture, and also then to set the organisation on a path to close whatever those gaps are. I’m very pleased to say that Mirvac has been on this journey for some time.

I’ve mentioned our purpose, which is to reimagine urban life. That came out of a process of engaging with employees several years ago now. We had clarified what our strategy was. Then we said, we’ve got a clear strategy now, but let’s just check in about why we are here. We asked people that: why are we here? What is our purpose? What are we passionate about? That’s where Reimagine Urban Life was born.

Having then clarified our purpose to reimagine urban life, we then embarked on a process to say, what does Mirvac need to look like? How do we need to behave in order to deliver on Reimagine Urban Life? Through that, we articulated a series of values and behaviours, one of which is doing the right thing.

So, I think that in this post-Royal Commission world, there’s going to be more time spent, as there should be, on culture. What is it? What do we want it to be? How do we get there? And more time spent on understanding the values and behaviours of people in our organisations.

PJ: You’ve covered some big topics there, Ben, and it might be a podcast for another time. I certainly recall your CEO … Mirvac and ChapmanCG have both jointly been involved and participated in 100% Human at Work. I’ve certainly heard your CEO talk about being a force for good and profits. That’s how sustainable success is being driven at Mirvac.

That was Ben Morris, co-head of HR at Mirvac, discussing a culture of flexibility and the positive impact it can have on both employees and the benefits for the organisation.

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