Large-scale Organisation ChangeA description of the approach taken to close an aluminium smelter in a socially responsible manner.

HR Leaders Resources Summit 2013

Agenda

1. The closure process

2. Managing large-scale organisation change

The Numbers

December 2011 Reduction in support staff 50

January 2012 Curtailment of potline 1 150

May 2012 Full curtailment of plant 338

December 2012 Mothball crew remaining 12

Total affected 550

The Closure Process

Organise Town Hall Meetings

Organise Consultation

Letters To Homes

OrganiseExit

Interviews

IssueRedundancy

‘Quotes’

OrganiseRedundancy

Expos

OrganiseExit Medicals

Conduct Phased Exit of

Employees

Assess Employee

Assistance Needs

Connect Employees

With ServiceProviders

Manage Outplacement

Service Provider

IssueRedundancy

Letters

OrganiseRecords Archiving

Notify Centre Link

OrganiseCentrelink

Financial Advice

Organise Training

& RPL

OrganiseJobs

Market

OrganiseSmelter

‘Memories’ Book

ManageMedia and

Communication

Measure & Follow-up

Success Rate

Process Step 9 – Conduct Phased Exit of Employees

Task Responsible DateDevelop phased curtailment plan by employee name SMT 6 June 2012Publish plan by department and task SMT 7 June 2012Interview and select outplacement provider TH/CF 9 June 2012Input termination details in EIS & SAP HR JW CommencedInput termination dates into redundancy list DS CommencedSet dates and conduct exit interviews CF/DS/BL CommencedPrepare, print & mail certificates of service records JW/RK CommencedPrint training records from EIS JW/RK CommencedReport weekly on progress to SMT & PM HR Oslo DS 29 June 2012Process salary notifications & termination notices RR/IS/JK Commenced

Finalise annual leave, approved leave and LSL balances RR/IS/JK CommencedCalculate final payments and effect transfers RR/IS/JK CommencedPrepare and mail final payment details to employees RR/IS/JK CommencedSet dates and conduct exit medicals CF/RK/DV Commenced

Arrange training to be completed and verified in EIS BL/DS Commenced

The Doom & Gloom Approach

The Appreciative Approach

Appreciative Inquiry is the cooperative, co-evolutionary search for the best

in people, their organisations and the world around them. It involves the

discovery of ‘what gives life’ to a living system. The inquiry is mobilised through

the crafting of the ‘unconditional positive question’.

What needs to be done in order to give our people a superior exit experience,

so that in the face of adversity, they’ll leave commenting on how well

they’ve been treated, better than they could ever have expected?

Jobs Market Day

70 exhibitors

6484 genuine vacancies

650 job seekers

6000 résumés supplied Orica 300 ResCo 300 Midal 180

15 jobs awarded on the day

792 interviews committed

The Cowbell & The KPI

The Things We Feel We Did Well (1 of 2)

1. Made repeated reminders of the importance of maintaining a focus on safety.2. Proactively managed stakeholders – Federal & State politicians, business leaders.3. Ran a ‘tight’, professional communication campaign to announce closure.

1. The Chairman of the Board held town hall meetings face-to-face with employees. 2. Genuine openness, honesty, empathy & respect in communication.3. Engaged professional expertise from FCR and Oslo to manage the media.

4. Addressed employee concerns quickly, including through Redundancy Expos.5. Provided counselling & therapy services to employees if required.6. Created a cross-plant decision making panel to maintain consistency & fairness. 7. Provided outplacement services through Pathways.

1. Worked with TAFE to provide Recognition of Prior Learning (RPL) certificates. 2. Prepared all employees to enter the jobs market professionally, and with confidence.3. Created a ‘positions vacant’ resource centre for job seekers on-site.

The Things We Feel We Did Well (2 of 2)

8. Provided additional funds for re-training & re-education. 9. Organised the JMD with enthusiasm and optimism.

1. Maintained the momentum caused by the JMD, e.g., interviewing services.2. Used professionals in event management for the JMD.

10. Despatched problem employees early, legally and professionally.11. Gathered input for the creation of the ‘Smeltdown’ book.12. Publicised the positive, heart-warming stories that began to emerge.13. Interfaced with DEEWR, Centrelink, and other service providers.14. Reviewed the phased closure plan daily to provide maximum flexibility.15. Followed-up on the re-employment KPI.16. In dilemma situations, used the company’s values as a guide.

The Things We Feel We Could Have Done Better

1. Managed expectations regarding the outplacement service.

2. Secured a full-time resource to bulk buy from training providers.

3. Managed expectations for the Jobs Market Day.

4. Defined ‘real jobs available now’ better for the Jobs Market Day.

5. Been more assertive with local firms regarding their recruitment processes.

6. Encouraged more active and positive participation from the AWU seniority.

A Change Management Methodology

Creating thevision

Making changelast

Making changehappen

Involving theright people

Forming thechange team

Communication

Leading change

A Theory of Resistance to Change

• The source of resistance to change is human feelings– people behave bad because they feel bad– no basis in logic or rationality so don't bother looking

• Change mostly makes people feel bad– negatives are much more obvious than positives

• Success = Overcoming Resistance = Modifying Feelings– anticipating feelings and responses, converting attitudes

• Resistance is not wicked– natural, honest, organic vs. conscious, deliberate, evil

• Managing change is a misnomer– manage emotions, sell change

Results at the End of the Closure Period

Zero LTIs – an outstanding safety performance

Record levels of production and quality

Zero scrap at the end of production

Zero disputes, no industrial action, highest levels of cooperation ever seen

Immense pride in cleaning and preparing the plant for mothballing

225 of 323 employees had found new positions at 31st December 2012

Zero suicides, family break-ups, depression

4 instances of counselling and support, short-term

Comments from AWU Delegates

I can honestly say I don’t hold any ill feeling towards Hydro over the closure. Common sense tells you that you can’t keep running a business that’s losing money, and keep shareholders happy at the same time. I take my hat off to the HR team for the way they handled this very tough situation, and kept the doors to the department open at all times. I have been in my new job now for two months and I am really struggling with the change – it’s just not the Hydro way! I have no choice but to deal with it and get on with my working life.

Trevor Morris, Senior Delegate, Carbon Plant

I was angry and disappointed at the news of the closure, and found it hard to front up for work. Hydro provided more support than most companies would, and did a good job of that, especially with the Jobs Market Day. We didn’t have enough time together to grieve as a family over the loss. People were leaving and sometimes we missed saying goodbye – it just seemed to happen so quick. If anything, I think the counsellor could have been more visible, spent more time with us in the crib rooms, providing emotional support.

Warren Hanley, Senior Delegate, Potrooms

A Short Exercise

Form small groups of two or three and discuss the following;

Why is it that after a closure announcement, managementand shopfloor workers lay down their swords and start to

cooperate like never before?

What can we do, as HR professionals, to help bring such levels of cooperation into our businesses

before the worst case scenario occurs?

www.hydro.com

Stay In Touch!

Today’s short presentation has only scratched the surfaceof how organisations can best deal with large-scale change.

If you are interested in learning more about how to apply a change methodology in your organisation, and being trained

in facilitation of the tools, please contact me at;

trevor@acuate-consulting.com

Tel: 0417 022657

To keep in touch, follow me on;Facebook at www.facebook.com/trevor.hall.351756?ref=tn_tnmn

and Twitter at https://twitter.com/AcuateHR

Questions?

Thank You For Listening & Participating