Rolls-Royce A joined up D&I strategy

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1 Rolls-Royce A joined up D&I strategy Company information Rolls-Royce designs, develops, manufactures and services integrated power systems for use in the air, on land and at sea. It is one of the world s leading producers of aero engines for large civil aircraft and corporate jets. It is the second largest provider of defence aero engines and services in the world. Rolls-Royce employs over 54,000 staff and operates in more than 50 countries. Diversity and inclusion themes Developing leadership Diversity as business imperative. Making public commitments Responding to unacceptable behaviour Sharing good practice Find out more g UT 708 STAD Sailor Rolls-Royce Apprentice in our Apprentice Academy Propeller for Marine Power 112

2 Diversity and inclusion toolkit Using difference to create innovation Introduction Toolkit Case studies Appendices 113

3 Background, aims and objectives Global demand for science, technology, engineering and maths (STEM) qualified employees continues to grow. The need for Rolls-Royce to recruit and retain locally based diverse leaders intensifies as their global footprint develops. Rolls-Royce recognises that an inclusive culture and diverse workforce is essential to achieving the company strategy. Diversity is critical to achieving a high performance culture and is a key enabler of innovation. This will help the company better understand market requirements and customer expectations and ensure it is trusted to deliver excellence. However, despite implementing numerous initiatives to promote D&I, it is evidenced through the annual diversity and inclusion reports that Rolls-Royce had not achieved the progress on D&I that it desired. It was, therefore, decided that a more strategic approach and stronger focus on the organisational culture was needed. Rolls-Royce s diversity and inclusion (D&I) strategy is based on three phases outlined in the figure opposite. Rolls-Royce s diversity and inclusion (D&I) strategy Awareness and Understanding Application Commitment Build and communicate the business case Encourage and enable leadership accountability Strand-based Initiatives based on business direction Develop leadership and HR awareness and understanding Drive business change Internal and external recognition Generate awareness and understanding for all employees Weave D&I into everything we do Culture change embedded One key objective was to build an inclusive organisational culture and, as part of this, to raise employees awareness of what is meant by an inclusive culture and how they are expected to contribute achieving it. The priority was to fully engage the executive leadership team and leaders across Rolls-Royce so that D&I is seen as a business imperative (ie it directly affects performance, innovation and relationships with customers). 114

4 Diversity and inclusion toolkit Changing work patterns 36% 36% of employers would advise someone who was thinking about stopping work altogether and retiring to consider switching to flexible or part time work for a period first. Source: DWP Age Positive Toolkit age-positive Specific initiatives Leadership and corporate culture Under the theme of developing leadership and a corporate culture that positions diversity as a business as opposed to an HR imperative, Rolls-Royce took the following actions: All business areas are required to include a D&I objective in their business plan. The D&I team set out guidelines to help leaders to understand the strategy better, provided learning points to help them understand what the journey might look like and how to analyse their demographic data. Employee feedback on the organisational culture was gathered via focus groups. Key themes were generated regarding what was working well and what needed to be improved to build an inclusive culture. During last year s senior leader conference (top 120 executives), there was a session on D&I research, themes from the focus groups, data and key messages. A discussion and debate followed to explore the impact, the implications for the D&I strategy and what actions were required. Following the conference, a training session was run as part of the Leadership in Action programme. This involved 450 of their global senior managers and incorporated D&I, cultural intelligence and respect at work. The sessions were facilitated by high potential employees to start debates. This session provided a powerful eye opener for leaders into the culture and behaviour in the organisation and helped to make them more selfaware. This approach really helped gain the engagement and buy-in of leaders and helped to avoid any dismissive behaviour because real-life examples were used to illustrate the points. The program encouraged participants to be more open and have confidence to challenge individuals as appropriate. To ensure that all D&I initiatives are led from the top, Rolls-Royce s Global Diversity Steering Group, which includes the chairman, the CEO, a non-executive director and the group human resources director, agreed to implement a number of different elements (ie internal aspirational goals) for the business presidents. The team s goals are monitored and reported back to global diversity steering group twice a year to review progress. To ensure this is aligned with the overall strategy and to measure the impact, they reviewed progress against the outcomes they expected at each stage such as the number of employees who are involved in employee resource groups. Using public commitments to drive organisational change Rolls-Royce has made two very public pledges externally in the UK to help drive organisational and sector change. They have signed up to the Industry-led 10 Steps, developed by engaging with leaders and CEOs across the engineering sector and by identifying an action plan based on 10 steps. These steps have been developed to ensure that women in science, technology, engineering and manufacturing have the same opportunities to progress in their career as their male counterparts. Rolls- Royce has pledged to work against these, be measured against these standards and report their progress annually. In addition, Rolls-Royce has signed up to Your Life, a three-year government-led campaign to ensure young adults in the UK have the maths and science skills needed to succeed in the current competitive global economy. It looks to inspire young people to study maths and physics as a gateway into wide-ranging careers while also triggering employers to recruit and retain this talent. There are three areas of action that organisations are asking to sign up to: recruitment, retention and progression. In relation to this, Rolls-Royce has committed to the following three actions: To grow existing and develop new STEM outreach activities targeting young women. To increase female STEM ambassadors to have more female role models delivering outreach activities. To increase female participation in apprenticeship and graduate programmes and work experience placements. Introduction Toolkit Case studies Appendices 115

5 Respect at work training Rolls-Royce has worked together with the Trade Union (TU) within the company in the UK and an external provider to develop and deliver Respect at Work training. Early engagement with the TU reps was critical to ensure the training met the needs of the business and created buy-in. The aim of the training was to develop greater awareness of inclusive and respectful cultures, help employees to recognise acceptable and unacceptable behaviour and develop the skills and confidence in dealing with situations of inappropriate behaviour in the workplace. The workshop included the use of role plays to bring the situations to life and give participants practical examples of situations of inappropriate behaviour and the opportunity to discuss and implement how to deal with this. There has been positive feedback from participants involved in the training, and this is going to be followed up with high performance culture training in these areas. Impact In terms of measuring the impact of these initiatives, Rolls-Royce conducts an annual review of D&I as part of its normal business process. This enables the company to track progress year-on-year and to identify successes and where further improvements are needed. It has also been able to use the data and results with leaders across the organisation, and this has been a powerful mechanism for increasing engagement and buy-in. Rolls-Royce has a D&I dashboard, a global offering for all HR teams to collect and monitor data relating to gender, age, length of service, ethnicity and nationality, progression, starters and leavers, high potentials, international assignments, early career pipeline and grades. This enables them to see trends and comparisons and identify where any improvements are necessary. The employee opinion survey also enables the organisation to measure perceptions of issues such as bullying, harassment and discrimination. Last year, the results of the survey indicated that there was a greater awareness among employees of the types of behaviours that are inappropriate in the workplace. Rolls-Royce has also seen positive changes in the way people act with each other as well as changes in leadership behaviour, such as in how they deal with people, how they think and how they develop innovative thinking. In terms of the future, Rolls-Royce believes there is still a long way to go, and they are focused on maintaining these efforts. Challenges The following are some of the challenges that Rolls-Royce faced when implementing these initiatives: There is disbelief that there was a need to develop a more inclusive culture and foster greater respect among employees. However, by using focus group findings, data from the D&I dashboard showing trends or lack of improvement allowed the ability to challenge appropriately, and this helped change a lot of mind-sets. As an engineering organisation, data is strongly valued. They have had discussions about whether D&I should be owned by human resources or sit within the business. It was decided that ownership has to be in the businesses with the senior leaders and that HR professionals would be there to support them. This is important in terms of ensuring that everyone takes responsibility for D&I and that it is embedded in the culture. However, it is also recognised that one of the biggest challenges for the future is sustaining focus and momentum when there are other business priorities taking over. In terms of overcoming this, Rolls-Royce recognises that it is important to be aware and plan ahead to manage this effectively if and when it happens. Training for the HR function was a key objective last year to ensure that it was ready to support the business appropriately. Hints and tips If you are going to have champions and sponsors, they need to be authentic for it to be taken seriously. You can implement many different initiatives and spend lots of resources, but if the culture of the organisation is not right, it won t work. Everything has to be connected. For example, at Rolls-Royce, D&I is integrated into executive leaders objectives, business plan deployment, the code of conduct, leadership model and our talent pipeline. D&I has to be led and role modelled from the very top. Next steps This year, Rolls-Royce is planning to launch more employee resource groups (employee networks) to promote change. Each group has a senior member of the leadership team as an executive sponsor, and to support the employee resource groups, we are implementing regional and country level steering groups in addition to steering groups already in place. gsee Appendix 3 for more guidance on specific initiatives linked to this case study: Global perspective Respect at work training Role of leadership Strategy gfor useful resources and organisations to support your work, see Appendix 4. i To find out more about the case study, contact diversity@raeng.org.uk 116