Previous Article Next Article Related posts:No related photos. Rostya Gordon-Smith, one of GlobalHR’s top 50 international HR directors,talked to Pepi Sappal about her intention to help build a new democracy in hernative Czech RepublicMost HR directors flinch at the thought of having to implement yet anotherchange programme. But change programmes in Central and Eastern Europe (CEE)have been far more complicated in recent years, as they have had to deal withmore than just a change in the direction of the company or corporate culture.Like APP’s VP of HR, Rostya Gordon-Smith, many HR directors in CEE aregrappling with people management issues within organisations that are trying toadapt to an economy in transition from a socialist to a market model. “It hasn’t been easy,” admits Gordon-Smith, “because we arecharged with the responsibility of shifting the mindset of employees who arestuck in the working ways of a planned economy. But if companies in CEE, manyof which have attracted Western investors, are to retain that investment andmeet their profit targets to survive in a market economy, they must change andconform to the new economy. “We at APP (a Czech IT software integrating company), for example, hadto reorganise the company by slimming down, cutting out unnecessary positions,being more productivity-driven and aggressive in getting clients, and generallybeing more customer-focused to be profitable and satisfy our US investors – allthings that we have never had to do here before.” To help APP achieve all that, Gordon-Smith has had to help its employees getto grips with the workings of a market economy. Luckily, unlike most of herCzech colleagues, she has benefited from an international perspective. Beforeshe returned to her homeland in 1996, she spent 30 years working in countrieslike Hong Kong, Japan, Brazil, Canada and Britain, in several training,educational and HR roles. “After taking my four sons back to the Czech Republic to show themtheir roots in 1991, I discovered that my roots were stronger than my wings. SoI decided to move back to the Czech Republic, as I wanted to be part ofbuilding a new democracy,” she says. Four years on, having worked in a couple of HR posts in the Czech Republicfor both KPMG and RadioMobil, she admits that things aren’t as bad today aswhen she first got there: “I arrived to discover that HR had a rock-bottomreputation. The job of HR was often filled by communist stoolies put there tokeep an eye on workers. HR people were simply there to police the workforce,take care of admin, and arrange social events like picnics and Christmasparties.” It is at APP, where she was charged with the responsibility of changing theculture of the organisation, that she’s been able to put her internationalexperiences and knowledge of the workings of democratic systems into practice.For example, she has given some of APP’s leaders exposure to the outside worldthrough international conferences and secondments. She’s also helped staffunderstand the synergy between the culture within the organisation and the wayits outside image is perceived by customers. “Yet employees at all levels have found it difficult to deal withissues of transparency,” claims Gordon-Smith. As outside investors requirecompanies in the CEE to become more transparent, open and honest aboutdealings, the concept of “brown bags” and bribery – features left bya communist past – are not tolerated any more, especially if you have USinvestors. “So, if we say we are transparent and ethical, we can’t havesalesmen who bribe, and we had to instil that within our corporation.” And it’s not just APP’s staff who are struggling with matters like ethicsand values, employees all over the CEE are facing the same problems, claimsGordon-Smith. “HR directors here simply can’t muster the strength to standby their values. “For example, when announcing redundancies, they still find itdifficult to convince the powers that be to pay for outplacement services. Asthey lack the bigger picture, they are not always aware of the repercussions oftheir actions. They don’t understand that if they let go of people in an unfairmanner, it may backfire if they then go and work for a prospective supplier andinfluence future business. They could even bad-mouth the company to potentialrecruits.” Letting go of the old structures left by a centrally planned economy,especially by those who haven’t benefited from such international exposure,hasn’t been easy. “Like most other professions, HR in the Czech and SlovakRepublics is not yet confident when it comes to dealings with the outsidebusiness world because of a lack of business understanding. “So it’s not surprising that HR is finding it hard to move away frompolicing their workforce to aligning HR with bottom-line benefits,” sheadds. It’s not a problem of intellect and brains, but one of management.”Although we have extremely educated people – 90% of the workforce areuniversity educated, mostly in technical fields – they have lacked the exposureof the workings of a market economy, so they’re still skeptical and suspiciousof the outside world. For example,” she points out, “HR is dubiousabout concepts like outsourcing. Their main fear is, ‘if we outsource, we aremaking ourselves redundant or we’ll be viewed as not being able to do our jobeffectively’. They are finding it extremely difficult to give the housekeepingaway and concentrate on the strategic stuff.” The lack of resources to help people get a grasp of these basic businessconcepts hasn’t helped. “There’s a lack of information in this part of theworld. Even when it does become available in books or on the Internet, it’s notalways of use, because either it’s in English, a language that is notunderstood by everyone here, or, if they do have the linguistic ability, theydo not have access to the Internet,” explains Gordon-Smith. “Ofcourse, these issues are less of a problem for those working formultinationals, as they receive help from HQ.” But she’s doing her bit to help HR get to grips with these issues throughher role as vice-president of the Czech Society for HR Development at itsannual conference, which is gaining ground every year. At last year’s event shelaunched their first HR Excellence Awards. “We sent 1,700 letters to CEOs to nominate the best HR person and bestproject, but the response was somewhat lacklustre. Out of 1,700, we got onlysix nominations,” reveals Gordon-Smith. “On the upside, all six wereactually very good projects. They all provided good best-practice HR casestudies. HR director Vaclav Jakes of Trinecke Zelezarny, a steelworks factoryin Northern Moravia, a town with very high unemployment rates, won. He set upan overalls factory employing 42 people, the majority of whom were women anddisabled people. “To the corporation’s surprise, the project was profitable within threemonths. The project won because it touched people’s emotions and demonstratedthat HR can do something in a depressed area and be a change master. Not onlydid he contribute to the social community but he helped to improve the bottomline. And he’s already planning for 50 more jobs.” Gordon-Smith has certainly helped change attitudes towards HR, both at acorporate and national level. “We’ve come a long way,” she pointsout. “We’ve progressed so fast during the past few years that we arealmost facing the same issues as the developed West. It’s finally dawning on HRhere that our job is not just making people understand that companies are thereto make money, but also to help staff understand that their jobs might not behere tomorrow and that they need to take charge of their own careers anddevelopment.” Her list of achievements is long. Apart from contributing to APP and theCzech Society for HR Development, she’s been instrumental in several otherprojects, including creating APP’s Corporate University and designing one ofits core courses – the leadership programme. She has also helped to launch aMasters course in HR development with the Czech Technical University. But she’s not about to put her feet up just yet. Shortly after thisinterview, she resigned to set up her own consulting firm. “As I came tothis country with the idea of helping to raise HR standards and contribute toits growth, I think I will be able to serve my mission more effectively if Iwork with several companies rather than just one,” concludes Gordon-Smith. Changing the face of HROn 1 Feb 2001 in Personnel Today Comments are closed.