How to design and build your people operating system

So you want to create a great culture, one that makes your people more engaged, improves customer experiences and drives your business performance and growth…

And if you’re growing through about 100 people, you know you need to create a seamless people operating system… but how?!

Well, here are five key principles to get you started…

1. Treat your employees as the users of your people operating system

The key to designing a great people operating system is recognising that your employees are the users. Your people operating system should work for your people, not the other way round.

This means you have to design your people operating system to improve your employee experience. It should make your company a better place to work and your people happier and more engaged.

Above all, your people operating system should make it easy for your people to do great work and this means trying to create a seamless user experience, where everything feels coherent and aligned.

The users of your people operating system are your employees. The purpose of your people operating system is to improve your peoples’ experience in a way that makes it easier for them to do great work for customers and to create value for the company.

To do this you have to start with user insight. You have to understand your people’s lived experience – the journey they’re on and how they see their personal narrative: their values, motivations, hopes and fears.

To stop yourself getting bogged down in the detail, what you’re looking to identify is the moments that matter — the peaks, troughs, milestones and transitions in people’s journeys, where your current people operating system either creates a tension on the culture you want to create or where there’s an opportunity to increase the flow.

The more insight you have into your people’s employee experience, the easier it becomes to identify, prioritise and target those elements of your people operating system that make your people’s lives harder and less rewarding (and which detract from customer experiences and business performance). Genuine user insight also opens up opportunities for you to anticipate your employees’ needs so you can surprise them with personalised support or services that appear just when they want them and how they want them.

The holy grail, is to try and identify channel factors - small changes in the system that create big changes in behaviour and performance. The Google canteen queue is one example – providing great food for employees but limiting capacity to create a bit of a queue so people talk to each other, make new connections and share ideas.

2. Don’t introduce new people management ‘applications’ in isolation from the system

The reason we like the term ‘operating system’ is that it encourages you to see people management like the software on your phone. If you build a great application, but it doesn’t interface with the OS, it won’t work or it’ll keep crashing.

However, in the HR world, HR teams love to build in silos. The talent acquisition team looks at recruitment. The L&D team looks at training. Reward owns compensation and benefits and so on.

The challenge with this approach is that you build great HR applications that don’t knit into the system. And because these new interventions aren’t integrated into the system, they end up delivering less value than promised. It’s the equivalent of building an iPhone app that doesn’t work on iOS.

Unfortunately, in the HR world a lot of well intentioned effort goes into building interventions or new services that actually make the employee experience worse, undermine the flow of the people operating system and detract from the performance of the company.

Let’s take a real example of how the people operating system perspective makes a real difference to how new interventions are introduced to established cultures.

At the moment, lots of companies are switching from a traditional, annual performance appraisal, to more frequent feedback. Great. It makes sense. It’s what employees want.

But the mistake of many companies is making the new approach to performance management a project that’s delivered in isolation from the rest of the system. So when it’s launched, it’s another thing that gets layered onto the business. It doesn’t quite get the traction the team hoped for and it doesn’t deliver on the promises made to the Exec. People don’t use the new ‘app’ to its full potential.

In contrast, designing and building with one eye on the people operating system would mean:

• Treating people managers as users not servants of the system and appreciating that different managers have different needs. So instead of putting all of them through a ‘one size fits all’ training course, making the effort to understand their different motivations, needs and journeys and then providing tailored training that arrives in a format and at a time the manager can use it. In practice it’s the difference between a mandatory half-day workshop that managers attend weeks ahead of their conversation with a team member and then forget the content by the time they actually need it; and a chatbot conversation in Slack that’s prompted by scheduling a 1-2-1 in your calendar and which appear a few days in advance with information that’s relevant to you. It’s the difference between training that’s provided as a one-off event, and a learning journey.
• Making sure managers have the information and data they need to evaluate people’s performance. And again, pushing this to them just in time and in a format that’s accessible and promotes a good conversation.
• Making sure that the support for managers is integrated into the onboarding journey for new joiners or people transitioning into a management role.
• Making sure that there are physical spaces for people to have good conversations. That the office has space for relaxed, quiet, intimate conversations where people can engage without distractions.
• Giving employees the systems they need to call in feedback ‘on demand’, so they can easily launch their own 360 on the feedback criteria they're interested in. And making sure there are pathways that lead out of the appraisal conversation, so employees can easily find peers, a mentor, coaches and learning opportunities.
• Shifting the criteria around the expectations of managers, how they’re evaluated and rewarded to take account of the increased focus on coaching and developing their teams.
• And perhaps most critically of all, taking stuff out… if you’re asking people to have more feedback conversations, what’s coming out to free up their time? Otherwise (all things being equal), every new people initiative basically just ends up asking everyone to work longer hours!

3. Don’t try to design the perfect target model for your people operating system

When you’re designing and building a people operating system you want to see the wood and the trees. You need a vision of what you’re trying to create and how that will support a culture that gives you a competitive advantage… but just like the operating system on your phone, there’s not a final destination. You don’t design a people operating system, build it and then leave it alone. And consequently you shouldn’t worry about designing a target model for your people operating system.

This runs counter to the ‘launch and leave’ mentality of traditional HR.

Traditional HR teams approach interventions with an assumption that they should take the problem off the business and that they are best placed to understand what’s required. More often than not this is based on their idea of 'best practice’ rather than user insight. They then over-invest in developing new interventions (at great time and cost) without prototyping or involving users in the process. And they don’t build in feedback loops because they don’t want the risk of evidence that might show the intervention has been a waste of time and money. Once it’s launched, the HR team makes a bit of a fanfare about the shiny new initiative and then they move onto the next item on the to do list. No review. No measure of effectiveness and certainly no budget for making iterative improvements or responding to user behaviour and feedback.

The way to build a seamless people operating systemis to build iteratively. No matter how smart you are, you’re never going to be able to accurately predict how a new intervention will be received by the business. Culture is a complex phenomenon — you only really get an insight into how your company culture works retrospectively, when you try to change it and see the reaction.

Building out a people operating system is therefore an exercise in learning by doing. It’s far better to release early, test and learn based on user behaviour. And you need to follow-through on the feedback you get from users so you can fine tune the new ‘application’ so it transitions seamlessly into the wider system.

Read more about how HR teams need to change the way they work in this blog on what employee experience means for HR teams'.

4. Optimise in phase, pivot at the people transition points

In this blog we explained that for growing companies there are transition points where the culture that got you to that point, won’t take you through your next phase of growth.

Our view is that at these inflexion points, you have to re-engineer your people operating system if you want to continue to grow successfully and sustainably.

These transition points don’t come clearly signposted, but we think Reid Hoffman’s five stages of people growth provides a useful rule of thumb for identifying when your company is going to need some serious cultural re-engineering.

When looking at what this means for your people operating system, again the analogy of the operating system on your phone is useful. When you’re ‘in phase’ (i.e. you’re growing, but you’re still within the same tier), your focus should be on optimising your people operating system: releasing iterative fixes and improvements; building new applications to solve key people management problems.

Then at each transition point, you need to switch from optimising your people operating system to fundamentally redesigning and re-engineering it. In other words you’re looking to release a completely new version of your people operating system. Just like when you switch to the new version of iOS on your iPhone, this new version of your people operating system should feel familiar, it should stay true to your history, your values and principles; it should support many of the same applications; but at the same time it also has to have something new, exciting and more powerful than what you had before.

5. This isn’t (just) about HR tech

The biggest challenge with the concept of a peopleOS is that you can fall into the trap of thinking the answer to everything is new HR tech.

Now don’t get me wrong, modern workplaces are digital environments. The reason there’s currently a glut of investment going into HR tech is because there’s so much scope to use technology to make people’s working lives much happier and easier. If you reflect on how technology has revolutionised customer experience over the last 20 years, my view is that you should expect a similar revolution in the employee experience space. But it’ll happen more quickly and it’ll be even more disruptive.

But introducing new HR tech isn’t sufficient to create a flowing people operating system. Indeed you can introduce great HR tech that actually makes your employee experience worse.

Let’s take a hypothetical example… you think you can make your people happier and encourage the behaviours that make a difference to your customers if you improve recognition in your company. Not an unreasonable hypothesis. So you go and find a great piece of new HR tech that does a wonderful job of facilitating peer-to-peer recognition. But if you don’t have one eye on the systemic impact of this new technology, you’re likely to do things like:

• Drive adoption in a way that kills off the more natural and impactful person-to-person moments of recognition; or
• Create a process that employees try to game in order to get recognition and rewards from senior leaders with the net impact that most people are left feeling cynical and disengaged; or
• Not ensure that the new tech is integrated into your existing communication platforms… in other words, you end up creating yet another application employees are expected to login to and be active on

A people operating system covers much more than just the tech applications that underpin your workplace. It incorporates how you structure your organisation, your teams and roles; the story you tell about the journey you’re on; how you support people to learn and develop; how you make decisions, run meetings and review work.

What you’re aiming for is a system that works in harmony. If you get it right, you create a workplace that flows. A place where it’s easy to do great work. An approach to people management that encourages that special, emergent quality of a high performing culture… the point at which your company becomes more than the sum of its parts. A great peopleOS is the foundation for creating the type of culture that lifts individual performance and enables people to achieve things they never thought possible.