Darren Entwistle, president and CEO of the telecommunications company, identifies culture and leadership philosophy among its key attributes.
Darren Entwistle, president and CEO of TELUS since 2000, began his telecommunications career as a telephone installer and repairman more than 30 years ago. Since then, he has made an indelible mark on telecommunications globally. Under his leadership during the past 12 years, TELUS has advanced its wireless and data growth strategy and consistently led the world's telecommunications companies in total shareholder return.
Recognized six times as one of Canada's Top 100 Employers, and a seven-time winner of the ASTD BEST Award, TELUS is widely recognized for its progressive learning culture. We talked with Entwistle at TELUS headquarters in Vancouver, British Columbia, about learning and other success factors.
Your commitment to building the culture at TELUS has made it unique among telecommunications companies. Where does your passion for culture come from?
It comes from a deep-rooted belief that when your peers and competitors are able to emulate your technology, you realize the one thing that is difficult to copy is your culture. That's something to invest in because you can build a sustainable competitive advantage through your culture that outlasts anything you do at the product or technology level.
We felt that we had within this organization the necessary commitment, intellect, and discipline to hardwire the human practices in a way that would elevate our performance culture far ahead of the competition and allow us to have success not just in one year but over a multiperiod basis. That's been brought to fruition.
The perseverance factor at TELUS is huge. Developing culture is a long-term undertaking, but it's worth it because it really can differentiate you from the competition in a very meaningful way. Without that long-term commitment, it's difficult for the competition to catch up.
So that's been the key for us. It wasn't altruism; it was a hard business philosophy about how to stay ahead of the competition. Culture for us is very much a living organism because once you create it, feed it, nurture it, and challenge it, it continues to grow. And that allows us to answer the dynamic challenges that arise continually in an industry like telecommunications.
The TELUS leadership philosophy is one that invites challenges to the status quo. How does such a philosophy play out in leadership development at TELUS? If you believe that your people and your culture are your most important asset and you are living and breathing in a dynamic environment, then you should definitely put your money where your mouth is and invest in that. Over the last four years, we've invested over a quarter billion dollars in training and development, which is a nontrivial amount. I think that underpins and underscores our commitment to that particular philosophy.
And how do you know that investment in learning and development is working? The cascading impact of anything you do from a training and development perspective should be reflected in the stock price of the organization, the realization of your number one strategic priority, and the commitment of the employees.
During the past 12 years, TELUS has been second to none in shareholder value. Measured against every single one of our peers on a global basis, we have been number one in the world every single year with one exception [in 2009] when we were number three.
The point that is key here is that you could realize an achievement like that maybe for one or two years, but to do it on a sustained basis comes from the fact that the people of the organization are executing the strategy effectively. This is their achievement. Because people are the most important asset of this organization, and that is manifested in the quality of integration and teamwork in a way that is compelling to clients, it's clearly discernible in the shareholder value results.
A second indicator that our investment in people is working is the level of employee engagement at TELUS. In 2011, we raised our employee engagement 1,300 basis points to 70 percent, which is unparalleled in Canadian corporate history for a large employer of our composition, and something that we're particularly proud about. We just got the results of the half-year measure for 2012 and 70 percent has gone up to 78 percent.
Employee engagement is directly correlated to the investment we are making in the resources available to our team—from considerations such as work processes, tools, and so forth, to more evolved considerations like skills training, and training and development, to more subtle actualized states like career development and career succession planning. This continuing investment in our employees is one of the reasons we are getting such fantastic results at the engagement level.
What part does the TELUS leadership philosophy play in the company's success? Between the two bookends of shareholder value and employee engagement is the TELUS leadership philosophy, which has four pillars.
The first pillar comprises our leadership values, which we launched back in 2000. They are:
- we have the courage to innovate
- we believe in spirited teamwork
- we have a passion for growth
- we embrace change and initiate opportunity.
When we first introduced these values, there was a healthy degree of skepticism, but we stuck with it and reinforced the values down into the organization. Learning and development at a leadership level was a huge component of operationalizing the values to excellent effect.
Second, there is a method to everything we do within TELUS, from tackling a challenge as a team right through to training and development, and that's leveraging what we call Fair Process. This is a process for how you estimate your challenges, engage your team members, explore options for answering those challenges, decide what's best to do, and then explain why an option has been picked. That's Fair Process. It's not always a fair outcome, but it's a fair process. It's executing the option that we chose and then evaluating it from a learning and development perspective. Did it work? Did it not work? And then we recycle that learning back into the organization.
The third component of our TELUS leadership philosophy is inculcating a business ownership mindset. Our employees are the number one shareholder group in TELUS, outpacing Fidelity, T. Rowe Price, and other large institutional investors. It's one of the things that has made us unbelievably successful. When people have a business ownership mentality, you don't have to inject a passion for learning or continuous improvement or development. It comes naturally.
We are asking people to raise their game year in and year out. Your skills go stale because the market evolves—the economy, technology, client expectations, [and] the competitive landscape all evolve, so it is necessary to keep up-skilling. You know you are successful when learning is not a hermetically sealed functional responsibility in a particular constituency of the company, but is something that has permeated the management ranks and is seen as a management responsibility. You are successful when the appetite to learn is held as a responsibility shouldered by the entire management team and not by a functional remit within human resources.
The fourth pillar of our leadership philosophy includes our nine effective leadership techniques. This is very, very personal to me. These nine battle-worn underpinnings of success covering strategy, culture, structure, people—our greatest asset—and priorities are my intellectual property.
It's the nine effective leadership techniques in combination that will yield the desired results, but if there's one that's more important than the others, it's culture. But I bet you that 10 years from now, it will be the least chosen because our society is becoming increasingly short term in its orientation. It is all about immediate gratification, and culture is the antithesis of that.
What besides hard results tells you that the work on leadership and learning and development has been successful?
We live in a hyperconnected, super-empowered, social environment. Social media is a great way to get feedback that is immediate and real-time. It is a raw and unfiltered indication of how you are doing.
Number two is external recognition. What I like about it is that it distinguishes us on a relative basis versus our peers. Third-party recognition gives you a validation that is critically important.
Perhaps one of the most insightful pieces of feedback comes from how you are doing on recruiting talent. One of the key deciding parameters when a person adjudicates as to whether to come to work for you is the investment you make in training and development —from skills development to leadership development, to career development and succession planning. And I would say we do extremely well in people choosing us because of our track record in this particular space.
What attributes are you looking for in the leaders of the organization?
I look for the values expressed in the four pillars of our leadership philosophy that I mentioned earlier. Is this the type of person who can have the level of engagement that we really aspire to? You want leaders who can conceptualize strategies, and leaders who can operationalize, who can go from the conceptualization stage to animating it in the hearts and minds of employees—the engagement factor. You want leaders who make people feel like they have equity in what you are doing—the business ownership mentality. You want leaders who can gain that buy-in, that accountability at the ownership level.
Because there is no linear path to success and there are going to be pitfalls along the way, do you have the perseverance, the gumption, and the commitment to see things through? And one other really important thing: Can you learn on the fly from your competitors and customers and make adjustments along the way? Leaders who recycle feedback have the opportunity to raise the bar.
How do you reinforce the values?
We pay out $200 million every year in performance bonuses. That's $1 billion every five years—not a trivial amount of money. One of the things that is unique at TELUS is that we pay out 50 percent of the bonus on performance—on objectives—and 50 percent on how people exemplify our leadership values. To put it simply, we pay 50 percent for the "what" and 50 percent for the "how."
The thing that is so sexy about this is that frequently "the what" is not recurring whereas the how is. You can pay people all you want for a singular achievement, but it may not be repeatable. But how they realize that accomplishment, that's repeatable. So in terms of smart money, I want to invest in the how.
The four leadership values that I talked about earlier are the essence of the how. We measure people against all four of those values and their sub-attributes, which are customized according to the degrees of responsibility that people hold.
In the evaluation process we don't start with "Here's how I think you've done." We start with "Why don't you tell me what you think your skills are against these various attributes. And why don't we discuss where there are the largest deltas between your perception of yourself and my perception of you as your coach, your leader, and your support person."
And here's where we take a page out of social networking. We say, "Why don't you ask your peers for their views of your leadership skills in this area, or the people that you are charged with leading." This is not something you do only once or twice a year. You do this on a monthly basis. And you focus on the areas where the deltas are greatest.
And then you must connect those deltas with a customized career development plan to give people the necessary leadership skills to progress in the organization. This has a tremendous amount of interest because of the $100 million we invest in recognizing the how.
How do you operationalize the values?
Let's take the value of "courage to innovate" as an example. How do leaders respond to risk? Do they see it as something to be avoided at all costs? Or do they embrace it as a necessary mechanism for doing business? How do they treat mistakes? Are people admonished or expunged? Or do they treat mistakes as points of learning and development and embrace them openly and transparently? Our responsibility is to get a return on the mistake—to realize the tuition value and recycle that into the business so that our execution is better going forward.
A useful thing to do from a recognition perspective is an audit of recognition for particular values. It is likely to reveal that 99 percent of recognition is for the what. But if you can get a better balance between recognition for the what and the how, the impact on the learning framework and on the leadership philosophy is huge.
In your audit of recognition for the value "courage to innovate," check for a second parameter. How many times were people recognized for failing? You can get everything right and still not be successful because you can't control exogenous forces such as what the competition is going to do or what technology will be invented. There are many times when initiatives are not successful but the how is a work of art. Did you recognize that? It's five times more powerful recognizing failure than it is recognizing success. And the propagation impact for recognizing failure when the how was right—burning the how into the organization's leadership mentality—is absolutely huge.
So when you're selecting leaders and you want them to exemplify courage to innovate, courage toward a chosen purpose, you must ask: Do they have the courage to recognize and learn from their mistakes, the courage to recognize failure and propagate that across the organization? That's a scarce commodity.
Another leadership value at TELUS is spirited teamwork. Say more about that.
When we bring people into the organization we look at whether they can work in a team, but not just the conventional aspect of teamwork. Does their concept of spirited teamwork include a work-life balance perspective, recognizing the families of employees? Family support is a very important component of the leadership philosophy. If you don't respect work-life balance, then you don't get respect back. And that's cancerous to the organization.
Do people believe in and take spirited teamwork out to the communities? What's their view on volunteerism? What's their view of community engagement? What's their view on helping citizens in need? Do they view customers and partners as part of spirited teamwork or are they more transactional in their orientation? Do they put in as much or more than they expect to get out? Those nonconventional considerations are important when you're picking the leaders of the organization.
In addition to everything you've just talked about, when you're looking for a learning leader such as Dan Pontefract, who is head of learning and collaboration, are there other capabilities you're seeking?
Communication is critical because if the only learning leader within the organization is Dan, then learning is not going to be successful. He's got to propagate his passion and skills and his acumen to other leaders across the organization so that it permeates the management hierarchy.
Generating learning within a full command-and-control environment is very different from generating it in a matrix structure. So one thing that is important here where we have a partial matrix structure is the ability to influence without control. Dan has no command-and-control authority. He can't make people do things. But he has the ability to influence them to gain leverage. The ability to communicate and to get people to listen is the first step.
Then he has to create a pull (for learning) so that it's truly sustainable. He has to translate the learning curriculum into tools that support other people's business success, that help them meet their business goals, that further our strategy. If people perceive that learning will help them get a better result or respond to a difficult challenge, they are interested. They become part owners of the learning process. They take responsibility for seeing it to fruition.
In our dynamic environment where continuous improvement is critical, you need to be in continuous learning mode. That's the business rationale for learning. And what about the nuts and bolts? How do we promulgate the mechanics of the four pillars of the TELUS leadership philosophy? How do we cultivate the leadership skills that we want? How do we develop people on a customized basis? What do we do about succession planning? How do we leverage social media tools?
Learning is without a doubt a patchwork quilt that Dan has responsibility for bringing to fruition, but the reason it works is because he has created the pull. People see the business logic of it. They get the return on learning. If people understand that the return on learning is NPV [net present value] positive in its most quantitative and qualitative representation, then the degree of difficulty of Dan's job goes down.
And what does Dan do when he has created the pull for learning among 1,000 management personnel and has the white space to think about innovation? He thinks about learning 2.0, 3.0, 4.0, and begins to feather it into the organization.
TELUS is known for its innovative use of social technologies to drive learning. Many organizations resist social technologies. What advice would you give them about its value and the challenges it poses?
I would say that it is foolish, futile, and illogical to resist social media. It is inevitable and if you think you can police it out of the organization or take a compliance view of it, you are sadly mistaken. If you do that, it's very destructive to the positive attributes of your culture because you're trying to stifle natural communication and it actually undermines your learning environment.
Secondly, anyone who has had a child who learns differently sees how ridiculous it is to think that people all learn in one standard fashion. So the extent to which you can use social media to allow creativity and customization within the learning environment, I think that is an extremely smart thing to do.
Thirdly, why does learning have to be asymmetric? A teacher teaches; a student learns. With social media, the teacher can learn from the student. This creates valuable symmetry with two important attributes. You get real-time feedback that is far faster than traditional mechanisms. And social media has complete irreverence for the management hierarchy. As great as a culture may be, there are always filter brushes in the management hierarchy that sanitize raw data before it reaches the ears of leaders. Real-time, unfiltered data has tremendous value for me.
Another important thing about social networking is that people learn from each other, peer-to-peer. Sometimes peer learning has even greater authenticity than more traditional teaching paradigms. It also creates greater cultural connectivity, and that is important within the matrix structure where you want people to feel they're all rowing the same boat.
Social media is happily ignorant of the functional silos in the organization and also ignorant of geographic distance. Our topology spreads over 2,700 miles but intellectual property, peer-to-peer learning, skills, experience, and creativity flow across the organization at speeds that ignore time and distance and organizational boundaries, and that's extremely cool.
At TELUS we believe that the customer is our coach. The quality and specificity of customer feedback is an important part of our learning, and much of it comes to us through social media. And it's free of charge. That's gold dust. If you're ignoring it, you're missing an opportunity to electronically mine that gold.
What about social media and employee engagement?
Let's say, as the Hewitt paradigm does, that employee engagement can best be explained by five variables at most, right? Let's say that as a leader you're hitting the ball out of the park on three of them. OK, how are we going to tackle the other two? Well, at TELUS, we use the tool of Fair Process that was provided for us by the learning organization. As a leader, you want to do well on employee engagement because it will help us execute strategy effectively and generate results, and there's some money in that for you.
Fair Process involves engagement, exploration, and explanation. And how are you going to do that? Social media! It allows you to say, "I'm listening to you. Thank you for the feedback. Now I need your help developing a program to improve our performance in the two areas that you've identified as less than optimal."
You next explore some options together and bat them about. You can do that through social media extremely effectively and very quickly. And then you rationalize down to two or three options you want to focus on, again using social media to explain your choices and how you prioritized them. The level of commitment there is huge.
Those are the first three steps of Fair Process. As you go through execution, you'll see a validation and a relearning as you cycle back into Fair Process. When you use Fair Process coupled with social media, the impact on engagement is phenomenal.
That formula is unassailable. If you have the diligence to go through something like Fair Process, while exploiting social media, any organization will have a major lift on the five most key determinants to engagement.
Are there other areas at TELUS where social media plays a role?
One important area is diversity. At TELUS we strive to leverage diversity not just because it's a moral responsibility, but because from a business perspective, in a truly diverse organization, the whole is greater than the sum of its parts. If you have pervasive homogeneity, you all run after the same opportunity and miss the same threats because you all think alike. Heterogeneity gives us the diversity of thought, skills, and experience that raises our game.
Social media can make a big company feel smaller within the psyche of individuals. Our lesbian, gay, transgender group at TELUS, called Spectrum, wouldn't exist without social media. When we kicked it off, there were a number of people at TELUS working in parts of Canada that are quite closed, who were afraid to come forward because they felt alone. I can tell you that people within Spectrum feel much more protected by being part of a social media group. It makes people feel like they are co-located, like there is someone who cares about them, that they can voice their concerns. Without social media, they would not be the voice they are in the organization today. Their contribution is absolutely phenomenal.
Heterogeneity, supported by social media, helps us in other ways too. If you want to be number one, that means listening to the voice of customers who represent the various constituencies of society. Well, you're not going to understand them all if your organization is completely homogenous. We can serve our clients much more effectively as a heterogeneous organization leveraging social media tools.
On campuses today, recruits frequently ask what are you doing for communities; what are you doing to make a better tomorrow for society; and how are you leveraging social media tools in that regard? How is TELUS using social media to connect with the community?
The level of volunteerism at TELUS is very high. Our 40,000 employees have volunteered 4.2 million hours over the last decade. To put that in perspective, Verizon is just below us with 4 million hours for 217,000 employees.
I will give you two examples of how social media played a role in those efforts. The BC Women's Hospital Breast Imaging Clinic is going from the dark ages of analog mammography to digital mammography, thanks in part to money raised by a social media campaign that we ran on Facebook. We offered to donate $1 to the campaign for everyone who turned their Facebook page pink. We thought it would be fantastic to get 100,000 people to do it. In the end, 800,000 turned their Facebook pages pink and Go Pink was one of the top three campaigns in the world on Facebook.
Social media is great for driving awareness and learning. We're using it now to get people to become registered organ donors. In Canada, 85 percent of people think that organ donation is absolutely the right thing to do but only 14 percent are registered organ donors.
One final example of social media's role concerns the large number of employees retiring in the next five to 10 years from companies across America. From a learning perspective, I worry that they will take their intellectual property with them. As aboriginal cultures know, if you can't pass your culture down from generation to generation, you lose it.
If we could put a dollar value on knowledge, would we let millions or billions just walk out the door? No. That would be a breach of fiduciary obligations. Social media provides wonderful tools for passing knowledge from one generation to the next.
What lessons can you share about career development?
Customized career development plans go hand in glove with succession planning. I see many mistakes in this area, especially in the failure to start the process with assessment. How can you say there is a continuous improvement environment and a continuous learning environment if you don't understand at an individual level what the continuous improvement requirement is? And you can't understand that unless you do assessments with a lot of discipline and rigor to identify the skills of individuals. This is why companies don't build cultures based on people as a competitive advantage: it's hard.
People often tell me "Here's what I want to do next." To which I reply, "How are you doing in your current job?" The best thing you can do to progress in your career is perform and be seen to perform at a high level in your current job. A customized career development plan starts with the skills you need to do your current job. If you do that continuously, you will set up your next career move.
Arguments about who is responsible for career development really frustrate me. Here's the balanced equation. Development for your current role is a contractual responsibility that the company holds. But development for career progression needs to be earned. It's a 50-50 responsibility between you and the person charged with supporting your development. The first line in a manager's job description is build the team, motivate the team, lead the team. If you're not going to manage like that, then I've got a headcount-saving opportunity.
Career development should be continuous, dynamic, and frequent. It can be wide. It can be narrow. It can be formal or informal, as long as it's collaborative.
In a well-integrated organization, you should be able to look at, say, 20 career development plans and see what the strategy of the organization is. I see tons of customized career development plans that don't bear any relation to progressing the strategy of the company. We are a for-profit corporation and that alignment is critical.
We encourage our vice presidents and directors to do what we call "skip level harvesting." On a regular basis, say every quarter, you randomly harvest three or four customized career development plans. Then you score them against the parameters that represent excellence in a customized career development plan. Next you sit down with the individual and their manager. Why have one coaching opportunity when you can have two at once? And you say, "Here's what I like and here are the improvement opportunities. Can I engage you in exploring some ways where we can try to improve the customized career development plan?"
Do you think that the learning from that process stays hermetically sealed within those few people, or do you think the learning is propagated through social media and other means?
And how does succession planning fit into the picture?
We go through succession planning twice a year and not long ago I made an embarrassing discovery. I was looking at candidates at a vice president level who were construed as being fully capable or ready now for career progression. Being fully capable means you have all the skills, including leadership skills, but you don't have the track record. Ready now means you have both.
So I did an audit to find out how many of the vice presidents who were ready for career progression had their own succession plan in place. Fifty percent didn't. How can you say that someone is ready for career progression but doesn't have a succession plan developed—especially when your principle responsibility is lead the team, motivate, and develop them?
How do you get those succession plans in place? If you want to fill those voids, build the farm system within the organization through the learning environment, through the succession planning environment, through the customized career development environment. And then you can progress your own career. It's a prerequisite to you making any move along the way.
Any final words?
All of this that I've talked about is easy to do. All you need is the intellectual model and the process, and to have the will and determination, and the cultural learning environment to bring it to fruition.
Darren Entwistle was interviewed by Tony Bingham and Pat Galagan.