GARDA : a company on a winning course! [CASE] CONTEXT. case. This year s case focused on Garda, a company active in the security industry.

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1 [CASE] CONTEXT GARDA : a company on a winning course! On March 23 and 24, 2007, Excalibur Desjardins, the Canadian University Tournament in Human Resources, welcomed students from 27 universities in Quebec and across Canada. The six finalist teams were asked to analyse an actual business case. This year s case focused on Garda, a company active in the security industry. In light of your consulting firm s reputation, the President and CEO of Garda has asked you to recommend HR management strategies to build a sense of commitment and loyalty among the company s employees. At the same time, he would like to maintain the firm s growth objectives and management philosophy. You thus held several meetings with various management representatives and retained the following information. BACKGROUND Founded in 1970, Garda changed hands several times before being bought by its current President and CEO in The company is active in the following four operating segments: consulting and investigations, pre-employment screening, physical security and cash handling. Garda has a well-established reputation: not only as a leader on the international scene, where it has operations in Europe, Mexico and the Middle East, but also as the second largest cash handling firm in North America. In addition, the company is considered to be the top Canadian player in consulting and investigations, preemployment screening and physical security. The corporation counts on 28,000 employees worldwide, mainly in the security and cash handling sectors, about 15% of E F F E C T I F S E P T E M B E R / O C TO B E R

2 [CASE] CONTEXT whom work part-time. Most of these employees are security officers. Garda generally favours a decentralized approach for each entity, apart from a number of shared functions such as finance, marketing and communications, information technology and purchasing, which are managed from its head office in Montreal. It has an administrative staff of 450 employees working in various branches across Canada. Of these, 180 are based in the Montreal head office. Listed on the stock exchange for the past seven years, the corporation has focused heavily on sales and profit growth in recent years and is now financially sound. Its success is largely due to its substantial growth and the creation of synergies between certain administrative and operational cost centres. Since 1999, Garda has posted an average revenue growth of 91.74%. Moreover, it hopes to reach its target annual revenue of CAN$1.4 billion in While internal growth explains a large part (65%) of the corporation s success in the last five years, its acquisitions have also boosted its earnings. In all, Garda has made 26 acquisitions in Canada, the United States and Europe since its inception. These acquisitions have enabled the corporation to secure an advantageous position on the global market, propelling it to fifth place in the physical security and cash handling sectors. The firm is thus close to attaining its CEO s goal to become one of the three largest players on the global market within seven years. Garda s executive team includes some 30 vice presidents, each with clearly defined roles and responsibilities. The company s human resources management is decentralized, with teams in Canada, the United States and Europe in order to comply with the legislation and culture in each region. Up to now, Garda has applied a rigorous management approach, maintaining the same organizational structure across the board. It now realizes that it will have to adapt this structure to meet these new challenges. CHALLENGES Industry observers believe Garda is on a winning course. Extremely targeted, in terms of both geography and activities, its acquisitions have been well-received by the financial community, shareholders and clients. Not only has the firm enhanced its value through these acquisitions, but it has also been able to successfully integrate these newly acquired firms into its overall operations. To achieve this success, management focused on the following four steps: adaptation of the existing structure, elimination of duplication, job maintenance and job improvement. All of these steps can be quickly implemented. Each acquisition is managed according to its specific context and employees are kept informed very early on in the process. Changes are communicated in collaboration with the management of the acquired entities since Garda understands the importance of both informal and formal modes of communication. The President/CEO and his management team play an active role in making sure the new employees are integrated in a positive environment. The result is that these workers are almost immediately familiar with the company s code of ethics and its values of team spirit, client focus, responsibility, integrity, effectiveness, simplicity, flexibility and commitment. However, because of the corporation s sustained growth strategy, the HR department at Garda Canada has to apply a shortterm management approach, while planning for the longer term. Given the 30 collective agreements in effect, their potential legal implications and regional economic realities, it is becoming more and more difficult to recruit a stable workforce. Turnover in the security industry is higher than in other sectors; when the unemployment rate drops, it s harder to recruit good candidates. In fact, employee recruitment and retention represent significant challenges for the company, particularly in Canada. Furthermore, the rate at which new public protection legislation is being introduced doesn t suggest the situation will improve in the near future. Garda is currently counting on the dynamism of its existing team to develop its employees loyalty and enhance their sense of commitment in the organization. Your team of consultants is required to analyze the situation and make recommendations on the strategies and priority actions to implement in order to build employees sense of commitment and loyalty. Any recommendations for improving Garda s workforce recruitment and retention should take into account the company s growth strategy, its desire to keep costs to a minimum and the need for rapid results. YOUR ROLE YOU ARE REQUIRED TO: 1. explain your understanding of the main issue facing Garda Canada; 2. determine the appropriate approach and priority actions that would build and even increase employees sense of commitment and loyalty, taking into account the expectation of immediate results; 3. explain the potential impact of your recommendations on HR management and on the organization; 4. list at least five (5) conditions that will quickly contribute to workplace commitment across the organization. 2 EF F ECTI F SEPTEM B ER / OCTOB ER 2007

3 [CASE] STUDENTS ANALYSIS BY THE TEAM FROM HEC MONTRÉAL The following is the analysis of the Garda case presented by the team from HEC Montréal, winner of the Tournament s first prize. The team was composed of Renelle Nicoletti, Antoine Schiele Spain and Maxime Turcotte. Competitors had 90 minutes to study the case. For successful growth, F.A.C.E. the challenges ahead Garda s goal is to become one of the three largest players in the global security market. This goal raises significant HR challenges for the company s Canadian division. Since the organization needs its employees to sustain its growth, we are proposing a strategic solution that will enhance their sense of ownership and loyalty. First, because of the collective agreements in effect, the company s management will have to work out any new changes and subsequent follow-up measures with the unions in question. It isn t easy to change practices like total compensation or work organization without the union s cooperation. Second, given its acquisitions, should Garda standardize its HR practices worldwide? Although our solution applies to the Canadian company only, expanding it to include all Garda s units is an option that could be considered in the coming years. In this respect, to ensure the integration of its culture and values, Garda should promote them more actively, not only to strengthen these values in Canada, but also to make Canada an example for other countries where the company is active. It s also recognized that because security officers usually work in teams of two rather than on their own, they have many opportunities to socialize. These opportunities should be increased to build a stronger sense of ownership among employees, which will in turn promote their retention. The reasons for the company s high employee turnover should be determined. This point will be analyzed in detail and solutions recommended in the action plan. Lastly, Garda ranks customer service among its top priorities. In this respect, the HR department plays a frontline role because it is human resources who provide services to its customers. Success will be far from guaranteed if HR managers aren t allowed to play a strategic role, if they aren t involved in the proposed changes and if they aren t represented on the executive committee. Customer service training, which Garda certainly already provides, is also a must. GOAL AND CHALLENGE Garda wants to become one of the three leaders in the global security market within seven years. To accomplish this mission, the company will have to rely on its employees since they are the ones who will sustain this growth. And that is the HR challenge. That s why the organization needs to be able to count on a competent and sufficient workforce, which in turn means it has to attract new candidates as well as retain and mobilize its current employees. These are the challenges that require a strategic solution. F.A.C.E. THE CHALLENGES AHEAD To meet its growth objective and become one of the three leading companies in its field, Garda has to F.A.C.E. the challenges ahead. But what exactly are they? They are human resources challenges that must be approached from a strategic perspective. Our solution is based on the following four points. FOCUS First of all, we focused our action plan on the organization s need not only to build a sense of ownership among its employees, but also to enhance their loyalty. ALIGN We then identified the relevant HR challenges, i.e. to attract, retain and mobilize employees, and developed an action plan that would both meet these challenges and support the company s sustained growth strategy. E F F E C T I F S E P T E M B E R / O C TO B E R

4 [CASE] STUDENTS ANALYSIS CONSOLIDATE We also determined the HR practices to be implemented, making sure that they would create synergy to sustain growth, while fostering employees sense of community and loyalty. EVALUATE Lastly, each of the HR practices recommended will be paired with performance indicators to ensure that the plan contributes to the company s growth. APPROACH We constantly kept in mind the fact that the action plan must support Garda s aim to secure a place among the world s top three leaders in the security industry. Implicit in this goal are the challenges of attracting, retaining and mobilizing the company s workforce. First, communicate Garda s values Garda has clearly defined its vision and values. First and foremost, it is extremely important for the company to communicate these values to its employees in order to mobilize them. Since these values are fairly wide-ranging, several of them could be combined so that employees could quote them more readily. Furthermore, the company could highlight two values per year and ensure that employees comply with them. To mobilize the workforce, we also need to identify the leaders within the organization. They, particularly front-line managers, will act as a link between management and employees. It will be up to them to share Garda s mission, vision and values with its workers. Obviously, these values should always be communicated in a similar format. Every six or twelve months, management could make a video to remind employees of the organization s values. CENTRALIZED HR MANAGEMENT STRUCTURE To achieve Garda s twofold goal, the main HR practices to be reviewed are recruitment, training, compensation, performance evaluation and work organization. We recommend centralizing HR management practices to standardize them Canada-wide through a single window approach for human resources. At head office, specialists in each field will serve as key resources for generalists working in the various divisions and branches across Canada. Applying uniform practices from coast to coast will make it easier for Garda to develop a sense of ownership among all its employees. We recommend the following practices be implemented. An employer of choice To attract good candidates, Garda has to become an employer of choice. It will have to put winning conditions in place and create a pleasant working environment so that employees will be eager to get up and go to work in the morning. It should also provide appropriate working conditions, competitive compensation, continuous learning opportunities tailored to individual or group needs, and a financial or other type of recognition/reward program (encourage and say thank you!). Lastly, it is obviously important to promote a culture of excellence and remind employees that they work for one of the best companies in the business. With these practices in place, Garda will be able to attract better candidates, enhance employee loyalty and improve its internal client service. Recruitment The company should first promote internal recruitment and mobility. Garda s employees already work in small teams. Why not open them up to promote mobility within and between these teams? This approach would not only encourage socialization and employees sense of commitment, but also enable them to acquire new skills. Internal competencies should be reviewed before a job is posted externally. Here again, attention should be paid to compliance with collective agreements, which most likely contain provisions respecting internal recruitment. Considerable effort should also be devoted to external recruitment. However, since its employee turnover is very high, the company should particularly focus on exit interviews to determine why these employees are leaving. It should then analyze this information and take the necessary steps to remedy the situation. Based on these interviews, Garda should also review the accuracy of its job descriptions. Employees who realize that their duties don t match their job description will be dissatisfied and inclined to quit. In addition to understanding the specific nature of the job they are applying for, candidates should also realize the company offers opportunities for future advancement. Selection criteria should also be reviewed. Since one of Garda s values is team work, team spirit should be added to the company s set of values. As for the actual recruitment process, Garda should develop an Internet site that reflects its status as an employer of choice. Candidates should be able to submit their applications, read testimonials from employees, etc. on this site. A referral system is another valuable yet economical option to be considered. 4 EF F ECTI F SEPTEM B ER / OCTOB ER 2007

5 [CASE] STUDENTS ANALYSIS Garda could also improve its employer brand via its Internet site and by an advertising campaign explaining that the organization is looking for quality candidates and offers attractive promotion opportunities. A potential slogan could be An exciting career in a growth environment. The introduction and integration of new employees is another relevant issue. Because it is important for them to be able to socialize with their co-workers, the company could create a social committee, set up a cafeteria where everyone could eat together, etc. The employee handbook should also be standardized across all Garda units. Training Since we are recommending standardizing practices, it would also be a good idea to standardize job descriptions and make sure that each employee has the appropriate training for his or her job. Garda naturally provides training when it makes an acquisition, but it should also promote continuous learning organization-wide to ensure its employees have all the competencies required. Furthermore, as part of its plan to offer career advancement opportunities, the company should target champions and support them throughout their training so that they can be promoted. A training program could add value to certain positions and improve employee engagement and loyalty. If the gap between the competencies acquired and the job requirements is reduced, the training will have achieved the targeted results. Compensation Once the new employees have been recruited and trained, they have to be paid. Given the company s recent acquisitions, the compensation practices of all the acquired entities should be reviewed before being standardized. The proposed salary structure ensures internal, external, individual and collective equity across Canada, according to the specific characteristics, working conditions, skills and duties of each employee. To evaluate this structure, a point-and-factor method should be used for each position. This uniform salary structure will attract good candidates and encourage current employees to stay with the company because they are well paid. It will also enhance the company s image as an employer of choice and a principled organization. The company s compensation system could be compared with that of industry counterparts for evaluation purposes. How it is perceived, changes in the turnover rate and exit interviews could also be analyzed. Performance evaluation Evaluating performance will enable the company to determine whether its objectives have been met. The evaluation program should of course take Garda s goals and vision into account. Firstline managers should be closely involved in this process since they will play a role in developing and implementing this program. The importance of a program of this kind should be clearly explained. For example, it will enable the company to plan recruitment and evaluate training needs, promote employee employability and develop a recognition/reward program. Here again, recognition will contribute to enhancing employees sense of ownership. This program will mobilize employees to meet their objectives which, in the end, will help Garda attain its goals. Work organization We recommend that team work be encouraged since Garda s employees don t work alone in any case. Working in sub-teams with the same pool of co-workers would give employees access to job rotation within the same team. Once again, the union should be consulted before this type of change is introduced. This initiative would also improve workers employability, flexibility and commitment, which would in turn strengthen their loyalty. A survey could also be conducted to assess the organizational climate. FIVE CONDITIONS FOR SUCCESS Five conditions will ensure the success of this action plan. Obviously, the involvement of senior executives and first-line managers is crucial.. In addition, the company should communicate its vision, values and culture of excellence on an ongoing basis. It should also talk to employees about possible promotions, target champions and clearly show them that they have a place within the organization. Lastly, employees efforts should be regularly recognized. CONCLUSION To sum up, Garda s primary goal is sustained growth. From an HR perspective, this translates into attracting, retaining and mobilizing employees. The recruitment, training and compensation practices recommended will undoubtedly enable Garda to attain these objectives. E F F E C T I F S E P T E M B E R / O C TO B E R

6 [CASE STUDY] PROFESSOR S ANALYSIS BY RIAN PIENAAR, PROFESSOR OF MANAGEMENT OF CHANGE AND ORGANIZATION BEHAVIOUR, TED ROGERS SCHOOL OF BUSINESS, RYERSON UNIVERSITY Attracting and retaining a committed workforce Garda is nearing its goal of becoming one of the industry s top three international players. However, given fluctuating economic conditions, emerging legislation, employee turnover, and recruitment and retention (R&R) challenges in a unionized environment, it realizes it needs to build employee commitment and loyalty to support its growth. ANALYSIS OF THE ISSUES AND CHALLENGES Employee recruitment and retention Since a stable workforce is crucial to sustained growth, Garda must determine how to recruit and retain quality physical security and cash handling employees in the above-mentioned environment. Understanding why employees leave is a key element here. The Canadian HR department should develop an R&R program to better balance labour supply and company demand, but these issues also need to be addressed regionally and company-wide. Union involvement, employee engagement and management support are all indispensable to the success of this program. Current role of the HR function Successful medium- and longer-term HR strategies partly depend on alignment with a longer-term corporate strategy, raising the question of Garda s goals beyond Ongoing acquisitions and a regional, decentralized, shortterm HR approach contributed to complex labour relations that impact on R&R. Since the current HR focus does not appear to be successfully addressing strategic workforce issues, strategic HR management is vital to recruiting and managing a more stable workforce. Beyond good communication Garda s growth goal and acquisition strategy require continued emphasis on an adaptive corporate culture to promote an external focus, an understanding of organizational goals and business processes, employee ownership and proactive identification of improvement opportunities. Garda s lower employee retention, loyalty and commitment, despite the particular strength of its management team s proactive communication, may be due to its acquisition pace, regional recruitment and longer employee socialization/adaptation periods. APPROACH Garda should establish a review team (HR experts, senior, middle and frontline managers) to evaluate HR management and recruitment practices. By targeting the Canadian division to develop and conduct an employee satisfaction survey, exit interviews and employee focus groups, this team can capture the lessons learned and analyze key retention issues. The team s findings, which will be communicated to the CEO and senior management, should serve to review working conditions, employee recognition/rewards, compensation and benefits, learning opportunities, and management and leadership practices. The CEO should appoint an executive team supported by HR experts, employee representatives and external experts to develop an appropriate strategy. This team should first draft a strategic communication plan to obtain widespread support before determining which review team findings can be implemented over the short-, medium- and longer-term, considering organization-wide impacts and implementation risks. The executive team, supported by the review team, should then report to the CEO and Garda and Garda Canada officers, recommending a workforce loyalty and commitment strategy, an action plan over the short-, medium- and longer-term and 6 EF F ECTI F SEPTEM B ER / OCTOB ER 2007

7 [CASE STUDY] PROFESSOR S ANALYSIS addressing the related scope, risks, resource requirements, timeframe, benefits and costs. Once the plan is approved, the executive team should prepare for implementation and ensure regular communication on results to keep Canadian division stakeholders informed. Plan focal points The first focal point is to embrace Garda s culture and deepen organizational values. Starting with the HR department, Garda Canada s management and the Montreal office, the executive team should collaborate with head office and the Canadian division to clearly articulate desired employee behaviours. Management can emphasize commitment and loyalty by walking the talk. Status and rewards for management/employee attitudes, behaviour and performance will communicate HR management priorities organization-wide. Management should also regularly review its HR approach and practices in relation to desired corporate values. After identifying key areas for adjustment, it should agree on systemic HR management and organizational changes, considering contractual and legal implications. Involving frontline managers is important as they represent the employer to frontline employees. To mobilize acquired firms workforces, Garda should stress the urgency of the need for employee commitment and loyalty. Management should clearly communicate its expectations through ongoing formal and informal communication and dialogue. When selecting acquisition firms, Garda should include a bicultural audit in its due diligence to identify gaps and formulate integration actions to ensure cultural fit. HR role, programs and practices The second focal point is to strengthen HR management s capacity to respond to strategic and regional challenges. The current HR management approach promotes regional strategies and solutions, while more strategic and company-wide HR challenges are prevalent. In Canada, the executive team should evaluate the present and emerging HR role and consider a more centralized and standardized HR approach. HR must be clearly positioned as a strategic business partner to support Garda s sustained growth strategy company-wide, beginning with discussions at head office and its Canadian division. Playing a centralized role will enable HR to address strategic HR issues across the organization and ensure the workforce and retention strategies needed to sustain growth. RECRUITMENT AND RETENTION Given the industry s high employee turnover, becoming a preferred employer is important. An R&R program should be developed to attract and retain security and cash handling employees. Supported by the divisional review team, the executive team should assess the impact of Canadian recruitment and socialization practices to understand the inherent challenges. Comparing employment and HR practices to industry practices will provide focal points for an R&R drive. The recruitment program should promote internal recruitment and job rotation to enhance employees interest in their job, skills acquisition, socialization and commitment. Web-based recruiting, print advertising and employee referral should be considered for external recruitment. Exit interview information can serve to target external recruitment drives and review job descriptions. A selection criteria review will determine consistency with company values. A targeted short-term recruitment strategy should identify appropriate sources and update recruitment content and selection criteria. Garda Canada should immediately standardize intra-organizational recruitment content, policies, HR management practices and materials. Over the medium- to longer-term, the Canadian experience can serve to achieve standardization and consistency across all divisions. Since these recommendations may impact organizational policies, plans and the recruitment budget, new recruitment initiatives should also consider collective agreement and organizational implications. E F F E C T I F S E P T E M B E R / O C TO B E R

8 [CASE STUDY] PROFESSOR S ANALYSIS Retention Successful retention depends on creating opportunities for more interesting work, advancement and recognition, as well as positive employee experiences and perceptions about the company and the job. The executive team should partner with Garda Canada s HR experts to review socialization processes. By collecting information from a sample of security and cash handling employees, they will learn about current issues and successes. Employees with advancement potential should be identified early and fast-tracked through training, mentoring and job shadowing. Their achievements/contributions should also be recognized. Compensation A cross-canada review of Garda s compensation policies and practices will indicate the degree of salary and benefit equity and serve to plan initiatives to attract and retain committed employees. A standardized salary structure should attract good candidates and encourage employee loyalty. Again, the impact on collective agreements and organizational policies and practices should be considered. Training All training activities, materials and procedures should reflect Garda s values. Emphasis on training will highlight advancement possibilities. Recommended training initiatives should be mindful of the associated return on investment and collective agreements since they may affect Garda s organizational policies, plans and recruitment budget. Impact While the recommendations will impact the Canadian division and HR management practices in the immediate term, given the numerous collective agreements and a global operating environment, they can be extended to other regions and the company overall. The strategic HR considerations and proposed centralization will have divisional and company-wide impacts over the medium term. Conditions for rapid success Continued clear communication with stakeholders; a dynamic guiding team with a clear mandate; corporate and divisional senior management demonstrating loyalty and commitment; frontline management walking the talk; union engagement and creating short-term wins are all essential conditions for rapid sustainable results. The Order would like to thank its main sponsor for making this tournament possible. For more information on the Excalibur Desjardins tournament, visit the Web site ORGANIZED BY: SUPPORTED BY: 8 EF F ECTI F SEPTEM B ER / OCTOB ER 2007