My Biggest Mistake: Geoff Armstrong

The director-general of the Institute of Personnel and Development - formed last week through the merger of the Institute of Personnel and the Institute of Training and Development - spent much of his career in industrial relations in the motor industry.

MY BIGGEST mistake, in common with others in my field, was to stick so long to the assumptions that had been the basis for people management in the western industrialised countries.

When I was a trainee manager in the 1960s, everyone understood that employee relations were only conducted collectively. Battalions of unions and management lined up against each other and conflict was regarded as inevitable.

The assumption was that people came to work to do the least they could get away with doing. Industrial relations was a way of making the system work with the minimum of disruption and cost. This led to spending a great deal of time negotiating.

But while we were negotiating we sidelined competitive objectives and, more important, customer objectives. When we reached a compromise we thought we had done a good job, but what we were really doing was compromising our competitiveness and building in a long-term impediment to efficiency. In the late 1970s we learned from the Japanese that if you had industrial relations based on what the customers wanted, rather than internally focused self-indulgent bargaining procedures, you were able to shorten lead times and the like. Whole industries, like shipbuilding, had already found they could not compete. It took us a long time to recognise the mistake we were making.

In my job as director of employee relations at BL Cars from 1979 to 1985 under Michael Edwardes, we were trying to challenge those assumptions. We tried to persuade our employees of the urgent need for change. We took often drastic action to end outdated demarcations and restrictive practices. We tried to free managers from the treacle of continuous bargaining and encouraged employees to learn new skills so they too could compete in turbulent markets. And we were partially successful.

Another mistake was thinking that by removing the restrictions, supervisors would just be able to step in and manage. We did not put enough into their training, again assuming that when it comes to managing people the ability comes with the responsibility.

The first mistake, then, was accepting the old mind-set. The second was believing that by taking away restrictions everything would fall into place. The third was not doing enough to put people in a position where they not only had the authority to do something but also the skills.

As I look at what my successors are doing at Rover, Jaguar and Unipart, I see that they have built on what we learned.

One of the key things that has held this country back is the lack of understanding of management, particularly in the area of people. We are pretty good at managing things like money and production. But we still do not take people management seriously enough.

The central task of the Institute of Personnel and Development is to promote good practice in the field of the management and development of people. In my view, that is the contribution most needed from us, and against which will be measured the success of our members and their value to the organisations that employ them.