A strong focus on alignment between strategy and culture has been critical to the success of New Zealand energy company, Z Energy, according to its CEO, Mike Bennetts.
He said there is a growing body of research which indicates there are some strategies that companies simply cannot execute because personal values trump organisational values.
“We were fortunate that our ‘best’ strategy was a match for the values of our people,” said Bennetts.
“We have purposely ensured our people are always connected to the ‘why’ of everything we do.
“Right at the outset, our people were key in developing the frameworks and foundations that have supported our success.”
Z Energy, an NZX listed company which supplies fuel to retail customers and large commercial customers, has also invested heavily in leadership development – a second key to its success, according to Bennetts.
“That’s because we believe that extraordinary results only flow from extraordinary leadership and that everyone in Z is a leader,” he said.
“After that we got focused on customers and developing our ability to listen and deliver what customers were looking for, or maybe didn’t even yet know they wanted it.”
Each year Z Energy goes through an annual organisational review in which Bennetts said it formally assesses its capacity and capability to execute business strategy.
“We work this as an executive team, identifying gaps and determining the actions we will take to close those gaps,” he said.
“We then share that with the board to get their perspective and for them to be assured that we can actually do what we have committed to by way of our strategy.
“We obviously don’t do strategy every year, but when we do we have a process for our commercial strategies and we do the same for people.”
This way Bennetts said the business has long term goals, measures and implementation plans that align between these areas, as well as the other functional parts of Z Energy such as finance, corporate and IT.
“Everyone at Z is responsible for their own development – HR plays a role, but ownership sits with each individual”
“As the CEO I am always looking for alignment between our various commercial strategies, goals and risks, to what we are doing with our people agenda – what we called organisational development,” he said.
“Working them separately raises execution risks and really undermines the importance of the mutuality and dependency between both of these.
“So we spend a lot of time working on our culture, and ensuring all of the HR processes (like recruitment, talent management, etcetera) are being done in a way that supports the culture we believe best delivers our commercial outcomes and targets.”
Z Energy’s GM people & culture, Sharlene Taylor, said it is fundamental that her team understands and aligns with commercial strategies, goals and risks.
“The risk of not doing this means that we are not able to support the business with delivering on their plans,” she said.
“Working in isolation is not an option and we have a big emphasis on partnering with the business to ensure alignment – so that our strategy is informed by understanding each area of the business’ plans and risks.”
The people & culture model is based on empowering people leaders and providing them with all the tools they need to do their roles to an extraordinary level, in turn empowering their teams to be the best they can be, according to Taylor.
“At Z we aspire to build what we call a ‘generative culture’ – a culture in which we celebrate our accomplishments and learn from the various things that may not go quite to plan,” she said.
“At the heart of building such a culture is everyone having confidence that they will be treated fairly – this starts with everyone understanding that they have a role to play in this.”
“We got focused on customers and developing our ability to listen and deliver what customers were looking for, or maybe didn’t even yet know they wanted it”
The processes the company employs are simple but well executed, Taylor added.
“We pride ourselves on our brand both internally and externally and at the core of this is our employee valuation proposition,” she said.
“We believe our employees are key to our success, which is why we continually encourage everyone to achieve their best – we stand behind our people and back them, but we also hold them accountable and expect them to demonstrate high levels of personal responsibility.”
Taylor said Z Energy’s work environment is one which is more closely experienced as a personal growth experience rather than just “work”.
“We have a large focus on developing our people and this means that we have an internal talent pipeline that is very different to most organisations,” she said.
“Rather than our employees just being able to develop in their area of expertise they are encouraged to stretch themselves further.”
By sharing information across Z Energy on what other roles in other teams look like, Taylor said this provides everyone with an opportunity to branch out.
“Everyone at Z is responsible for their own development – HR plays a role, but ownership sits with each individual,” she said.
“It also makes sure that we retain our key talent … we have a market presence that ensures we are readily able to attract top talent in the market and we have a focus on developing our people so that we have a talent pipeline.
“For example, we were able to source and fill approximately 80 per cent of our roles ourselves, and having a talent pool where we are aware of people’s aspirations and capability enabled us to deliver this result.”
Z Energy employs a balanced scorecard approach when assessing business outcomes, and independent research indicates that its customer satisfaction levels are market leading for both its retail and commercial businesses.
The same research says its brand preference is 34 per cent higher than its market share and the leader in its sector.
Its most recent employee engagement came in at 77 percent from a 96 per cent response rate, and Bennetts said shareholders returns over the past three years are over 90 per cent which puts Z Energy in the top five of the NZX50.
For the full story on Z Energy’s success see the next issue of Inside HR magazine. Image source: supplied
