Cargotec - Key persons as support for change
Text: Ari Rytsy, Pictures: Susanna Kekkonen
In connection with the process of structural change, Cargotec assigned particular emphasis to giving special recognition to its key personnel and to leadership. Moreover, the focal points for operations were the development of leadership and supervisor work as well as the optimal targeting of global human resources.
Cargotec is intensifying the effectiveness of the flows of goods by offering equipment, systems and services for loading and unloading. The company’s product brands – Hiab, Kalmar and MacGregor – enjoy a worldwide market position on both land and water. In addition to the development of professional technical expertise, the global matrix organization poses its own challenges to the firm’s human resource management.
In 2009, pressure was increased by the rapid deterioration in the global market situation. The decline in demand for equipment manufactured by Cargotec required brisk adaptation measures and rearrangements which were mirrored throughout the entire organization. In the administration of human resources, change management and support for change control were particularly emphasized. At the same time, however, it was necessary to cut down on the planned development measures for personnel in order to achieve the cost savings required.
The integration of various business activities initiated comprehensive reorganization, as a result of which the company's operational model and organizational structure were made more effective on the global scale. The renewal measures began from the sales and maintenance organization, from which the results obtained were beneficially utilized in the integration projects in other areas. Approximately 450 management personnel and key employees were assessed in total in connection with Cargotec’s Industrial and Terminal business area-related rearrangements. By means of this process, the most suitable skilled experts were sought for key positions in the new organization.
“Psycon was our partner in implementing the management audit concerned, which was a big project of internal change for us. The Leadership Capabilities for the Future project involved the participation of managers and team leaders from Europe, Asia and America,” Cargotec’s Director of Human Resources & Communications, Kirsi Nuotto, relates.
Skill in change management emphasized
In the Management Audit process, the focal point was on the basic areas of know-how for good leadership in strategic management and business knowledge as well as in personnel- and change-related management and operative leadership skills. Internal transfers were the focus in the change process. The goal was to promote work circulation and increase career development opportunities for the company’s own key skilled experts. Aside from successful key person selections, the process aimed at the systematic development of leadership as well as improvement in the personal operational readiness of those being assessed. In addition to basic know-how, deeper management capabilities were also emphasized amongst the leadership skills.
“In Finland, there isn’t enough discussion yet about leadership. The ability to inspire others and communicate matters clearly are intrinsically connected with it. A good manager knows how to pull the organization through change and build successful teams,” Ms Nuotto itemizes.
In Cargotec’s assessments, versatile expertise was emphasized, which meant the application of several differing evaluation methods. In connection with the process, those being assessed were told about the purpose of the personal evaluation, and Cargotec’s targets for the future were introduced. The entity was completed in about half a year, which shows admirable singleness of purpose on the part of an international enterprise. Examined in hindsight, the process was transparent and fair from the perspective of all participants. This survey of wide-ranging know-how provided useful tools both for Cargotec's management and for other personnel as well.
“The reports and feedback received were quite comprehensive. Also those who were not selected to the new positions benefited, I think, from recognition of the development targets. Everyone who has gone through the process knows what sort of know-how he or she ought to emphasize in the future,” Ms Nuotto asserts.
A global process – and practically-oriented realization
Kirsi Nuotto views the heightened objectivity as well as a fresh and expert perspective as the advantages of utilizing an external specialist. In Cargotec’s case, what was concerned was a wide-ranging project implemented with a rapid schedule, whose particular challenges Psycon took responsibility for in the manner expected.
“The realization of the assessments was handled in a highly professional manner with positive attention to the client's requirements. This was quite a jigsaw puzzle, all in all! Even so, the issues connected with, for instance, language and culture – not to mention the purely practical arrangements involved – were resolved very well,” Ms Nuotto says, complimenting the model cooperation that resulted.
The success in taking the whole project from beginning to end was certainly also supported by the previous partnership between Cargotec and Psycon in personnel evaluations, recruiting and 360-degree assessments.
“In this sort of process, partner selection is the biggest individual challenge. Our corporate culture and methods of operation were already known in advance at Psycon. Because of this, they knew how to challenge us and offer new perspectives in the selection of key personnel. Psycon was able to produce, in a short time, a comprehensive assessment battery and a sufficient number of the support groups required. All were linked up successfully into Cargotec’s own sub-projects,” Ms Nuotto sums up.
She is particularly satisfied with the quick lead-through of the process, which is highly important in an integrative situation between two separate organizations. Slow reforms easily lead to doubt and uncertainty on the part of the staff, which make effective continuation of operations difficult. In a global enterprise, the divergences between regional cultures also come to the fore. Taking all the various factors into account is challenging, but as it becomes successful the process generates the potential of building a better future for the firm. At Cargotec, the finding of the right key personnel will support international leadership in accordance with the company’s values.
“Future leadership will require, to an increasing degree, visionary qualities, good sales- and interaction-based skills and recognition of the elements of success in business. Functional core expertise is still important, but the individual’s personal management skills must be raised alongside it,” Kirsi Nuotto explains.
Performance history taken into consideration in selections
Ms Nuotto regards the general level assessment of leadership on the various levels as too minimal. In her view, it is essential to take the individual’s performance history into consideration – how and with what success s/he has previously managed. At Cargotec, the personnel assessments represent a basic tool that is used continuously for the development of staff and operations. In the same connection, the 360-degree measurement to be realized provides a multidimensional picture of the aptitude under evaluation. The cultivation of key personnel thinking has given rise to internal transfers in a horizontal direction from one business area to another and has also enabled a lightening of the competence level for work tasks if demanded by the individual's life situation.
“We don’t only support future managers and skilled experts in business. In some instances, the best solution is that the employee switches temporarily to look after a narrower task field than before,” Ms Nuotto says.
At Cargotec, there is a desire to support the individual also after selection. The enterprise is just launching its own mentoring program in which new abilities are put to the test by supervisors on the employee’s own line or by a person acting in another management task. This sort of steerage towards new tasks is fruitful in the sense that the persons chosen from various parts of the organization promote information change and the distribution of know-how. Having people from versatile backgrounds is also of benefit in different kinds of teams. The nurturing of know-how achieved over the long term is particularly important for the reason that these days people are more willing to move about than previously.
“From the company's perspective, long-term personnel investments are always a reasonable choice. For this reason, it would be advisable for an employee to stay in our employ for at least about three to five years. Too quick a change from one job to another does not benefit either party,” Kirsi Nuotto declares.
Change in the labor market is shown by the fact that along with the staff reductions carried out as a result of the more difficult market conditions, the company's management has emphasized fairness, honesty and respect for the employee.
International leadership
In the future, the administration of human resources shall play a more important role than formerly in companies’ business strategies and models. Also at Cargotec, personnel matters are strongly on the agenda of the management group.
“We intend to continue our investments in developing the international management culture. Our goal is to lead genuinely and transparently, which helps employees to do their best,” Ms Nuotto says.
She stresses that leadership culminates above all in the right persons. The bends and turns of the world economy cannot be averted by anyone, but learning from difficulties and emerging from them successfully are the distinctive characteristics of good management. This sort of maturation of skills can be promoted within the company.
“The development of personnel requires, above all, high prioritization, sustained long-term planning and good partners. The growth of future leaders must be given support both internally and externally,” Kirsi Nuotto clarifies.