Wednesday, 1 November 2017

Restrictive covenants – careful wording or a waste of time…….

Most contracts of employment have clauses which are collectively referred to as Restrictive covenants and these cover non-compete, non-solicitation and non-poaching.

Whilst these clauses take various forms, their purpose is to protect and safeguard the legitimate commercial interest of the business with a significant emphasis on the client base and preventing former employees from doing untold damage to a business by poaching customers, setting up in competition and recruiting former work colleagues.

Non-compete clauses prevent a former employee from competing with their previous employer, non-poaching clauses restrain a former employee from hiring former colleagues and non-solicitation clauses stop former employees from taking steps to encourage clients away from their former employer.

Whilst that all sounds quite straight forward, most such clauses then go into further detail in terms of the distance or radius in which you are prevented from setting up in competition or time scales within which you can’t approach clients or former colleagues.

At this point, the issue becomes less clear cut because whilst you can make the clauses so onerous that the person can’t do anything, the possibility is that in doing so, the clauses become so unreasonable that they become unenforceable.

 It is common practice when a person leaves a business and the Company acknowledges receipt of the resignation that they will be politely reminded about their restrictive covenants and of the possible consequences if they should step out of line…..and often CEOs and MDs will say – at least that will send a “warning shot across the bows”.

Whilst, the Courts are not averse to enforcing well-drafted and reasonable restrictive covenant clauses against former employees, the emphasis is on the careful wording and the interpretation of the word “reasonable”. On the one hand this destroys the myth that such clauses are not worth the paper they are written on but the legal costs of bringing such actions can be prohibitive – begging the question – what price do you put on protecting your business?
 
Some say that by making such clauses as robust and restrictive as possible, this will act as a deterrent. Dare I suggest that it is not uncommon for employees to have such clauses in their contracts and because of their legal speak wording, they don’t actually understand what they are prevented from doing. Sales people tend to focus more on the commission clause than their restrictive covenants! Maybe that’s because sales people are not renowned for doing detail?

The business should be clear about what it is trying to protect – client listings, technical expertise, system or process design……Business is about relationship building – we build relationships with our clients because if we don’ they won’t do business with us and we build relationships with work colleagues. Such relationships may stray outside work and you can’t prevent a former employee meeting with an ex-client for a coffee. However, when that former employee tries to entice the client away from one Company and transfer their business to another Company, the restrictive covenants will cut in.

The employment contract should be drafted to include clauses which include restrictive covenants designed to protect legitimate business interests and, therefore, should be reasonable in all senses of the word.

It is not uncommon in some situations, often related to signing a settlement agreement, where the business will agree to release the employee from restrictive covenants. I recall a situation many years ago when drafting a settlement agreement, I asked the CEO if he was happy to release the employee from his restrictive covenants to which he replied “Adrian…..the guy was so ***** useless, the competitors are welcome to him”.

Article by Adrian Berwick 

Adrian Berwick provides HR support for business and if you want any support on issues relating to restrictive covenants, contact Adrian on 07885 714771 or e-mail info@abcommercialhrsolutions.com

 

 

 

 

Tuesday, 7 March 2017

The Importance of Being Earnest

The Importance of Being Earnest

Brexit, Trump, Leicester winning the Premier league, the passing of musical geniuses – the list goes on.  Let’s face it, we have had everything thrown at us in 2016 but there’s one thing that remains certain and that’s change.    We are living in uncertain times and this will inevitably affect the decisions of organisations and their appetite to forge ahead with plans.  This uncertainty is creating the need for change on the one hand but paradoxically is leading to inaction on the other due to an over cautious approach.   It would be a huge mistake for organisations to do nothing with the risk of  market share loss, acquisition targets slipping through the net and losing key talent to name but a few.   

Leaving the EU is a mammoth task.   The globalisation of the UK is firmly on the agenda and although it will take years to go through this messy divorce, hopefully the UK will be stronger for it.  But what happens in the meantime?   It’s the uncertainty that will create problems as ‘projects’ are put on hold.  Clearly for businesses in crisis, something has to be done urgently but the need for an interim isn’t always for reasons of crisis management.   

Organisations in need of transformation, restructuring, project / programme management, business improvement or anything that results in change continue to need people to help drive them forward without distraction.  What has become prevalent  is the need to put a compelling case forward firstly as to why interim is the right/best solution and then it’s down to the interim to provide reassurance and a convincing pitch as to why they should be selected with some quantification around the return on investment (ROI). 

It matters now more than ever to make a difference but how can an interim executive ensure they make a ‘real’ difference and deliver in a way that meets with expectations? There are a number of skills, competencies and personality traits needed to succeed as an interim.  Here are a few;

Honesty – providing an open and honest account of the findings.  Interims are able to do this (on the proviso it’s delivered in a professional way) without fear of job security, weakening promotion prospects etc.  The value to management, shareholders, stakeholders and employees is immeasurable. Quite often the day to day gets in the way and organisations can’t see the wood for the trees.

Delivery – hugely important and ultimately will be the basis of measurement of how successful the assignment has been.

Speed – expect to be parachuted in to new environments, grasp what the business does, build relationships often with customers, suppliers, and subcontractors and address the issues causing the challenges.  The problem should be solved and solution implemented as quickly as possible.
Objectivity – an impartial view of analysis undertaken provides the leadership team with a balanced, honest opinion without the person delivering the message having another agenda. 

Coaching / Mentoring - this is always part of the brief whether or not it’s been clearly defined.  This can be for members of the leadership team, management team or just generally a style that should be adopted when leading people for the short term.

Engaging with stakeholders – interims often find themselves in quite complex scenarios with multiple stakeholders that have to be taken on the journey.  Building relationships is part of the remit.

Communication – can’t be emphasised enough.  Any change programme’s success is dependant on how engaged the people are. 

Don’t get drawn in to BAU issues – the reason the client has engaged an interim in the first place is because they don’t have the internal capacity or capability to solve the problem.   If the interim finds themselves in a firefighting situation, they are likely to take their eye off the ball from the original set of objectives.

Confidence and gravitas – the fact that someone has embarked on a career as an interim is borne from having achieved and delivered during a corporate career at board, functional or in a business leadership capacity.  This knowledge and experience should enable the interim to tackle challenges with the necessary agility and be chameleon like in approach.  

Managing the exit – once the agreed objectives have been delivered it’s important to manage an exit at the appropriate time.  The interim should avoid hanging around unnecessarily as this will quickly diminish the value created from the good work undertaken. 

Leaving a legacy – be remembered for the right reasons.

This is all underpinned by the raison d'ĂȘtre of adding value, making a difference and ensuring a return on investment.   It’s the little wins that can make the biggest difference and mopping up the unexpected problems where the interim can go the extra mile.

In order to ensure a successful assignment for all parties it’s important to be honest and how this is delivered will determine the added value in the long term.  After all, the results of this assignment will determine the reference received and how quickly the next one is secured.


For further information or a confidential discussion about how we can help please contact Steven Wynne on 01423 704153 or email steven.wynne@macallaminterim.com

Tuesday, 7 February 2017

     INTERIM OUTLOOK

Steering businesses in a world of growing political and economic disruption

During the last quarter of 2016 there was an increase in activity in some interim market sectors, which appears to have carried over into early 2017. There is talk amongst some businesses that the time for watching and waiting is over and regardless of the expected continued period of uncertainty, companies need to take hold of making the necessary changes to enable them to move forward and undertake the growth and opportunities available.

Or… is this another blip in interim activity soon to be followed by yet more market caution, uncertainty and hesitation?

What is certain is that change and uncertainty have become the new norm and will remain with us for at least the next few years whilst the world undergoes disruption, which some are referring to as the Worlds 4th Industrial Revolution. Sitting still and waiting for world stabilisation no longer seems to be a viable business option.

Global and domestic changes may well have significant impact on many business sectors that will need to respond to this by making their own internal changes, even if this is to retain existing business levels or avoid erosion.

Undoubtedly there will be many opportunities that will come with the significant changes that lay before us. Being nimble and building capability and flexibility into business models will be key to being able to manoeuvre through periods of sometimes radical and unexpected market changes and to grasp the opportunities that arise.

Political and economical changes will result from a number of foreseeable domestic and international situations which we may all have to work with -

  • Brexit will cause substantial changes yet to be realised, but some can be considered and reactions to   these identified and planned
  • New Free Trade agreements for Britain with larger overseas economies will produce market               opportunities which might require preparation, restructuring and added capability
  •  A European slowdown is already happening and the uncertainty surrounding elections there will          accentuate this at least through 2017 and beyond, added to a widening question by some countries      about their own continued membership of the European Union, general financial instability and even a  possible collapse of the Union.
  • The value of the Pound as well as the Euro and the US Dollar, will affect exporting and any increases    in the cost of purchasing products and materials may affect supply chains with a need to consider        alternatives.


Many companies may find the complexity and scale of such changes hard to deal with without help. Good interims who are over qualified and have done this before many times will be in demand.


With Thanks to Barry Allen

Interim Outlook by Barry Allen, an Interim CEO, COO, MD & Strategic Board Advisor 


Wednesday, 18 January 2017

Recruitment – Internal or External?

Picture the scene – a key member of your senior team has resigned and the situation can’t be turned round and you know you must replace – the dilemma is whether to “play it safe” and go with an internal promotion candidate or look externally.

In simple terms, internal promotion can be seen to encourage loyalty, build morale and send out a powerful message about career development prospects – assuming, of course, that the internal candidate has the rights sills and competences – but the drawback surrounds the missed opportunities of bringing someone new into the business.

Many companies are adept at creating internal pipelines of talent recognising the need to retain good people to give business continuity. And these businesses strive to offer people a career with vision of where their career may go within the company instead of having to leave to move upwards. Furthermore, the creation of continuous development opportunities for internal teams to ensure that home grown talent is always available sends out a strong and powerful message.

Some companies always promote from within first only bringing in new people at junior level. By doing this, they tend to have good retention at lower and middle levels and keep recruitment costs low. This tends to mean that people can rise from junior ranks fairly quickly before progression slows due to a mix of limited opportunities or their inability to progress any further.

Succession planning runs through the talent management process from recruitment to how employee performance is managed and building a culture of internal promotion makes a difference to an organisation and gives people aspirations. However, it is critical at this point that expectations are managed and also when an internal candidate is unsuccessful for a role, they deserve honest feedback so that they are able to re-evaluate their aspirations and re-set their goals based on reality. 

However, it is acknowledged that if the business is venturing into new markets or sectors, the likelihood is that the required skill set will not be available internally. Also, playing devil’s advocate there is a high amount of benefit to be gained by bringing in a fresh set of eyes with best practice knowledge and skills gained elsewhere. Rightly so, much is written to-day about the value of transferable skills and skills can transfer successfully between industries, sectors, markets and functions.

Whilst it could be perceived that external recruitment stifles the development of internal staff by cutting off potential promotion avenues, the counter argument is that promoting internal talent prevents the opportunity to inject fresh ideas into the business. Conversely, recruiting a manager from outside the business may mean that talent is unearthed in the business that the previous management structure had failed to identify or chose to overlook and new management gives these people new opportunities.

New blood into an organisation, specifically at senior level, brings new ideas, innovation, creativity, and different ways of working. It rarely comes without pain because it will also ruffle feathers, challenge the status quo, ask pertinent questions and shake people out of their comfort zone by getting people to up their game.
Business growth can also be a factor in the internal v external recruitment debate. Some employees are ideally suited to smaller businesses (invariably these are family based) and as the business grows and possibly the family influence begins to take a back seat, there is greater need for formalised management structures, process, procedure, controls and disciplines. Quite frankly, some people will find the growth transition uncomfortable and in simple terms, the business out grows the individual and a new/different skill set is required to drive the growth.

In these situations, bringing someone new to the table will bring much needed new ideas, freshness, energy and vision whilst challenging those that say “but we’ve always done it this way”.

If it comes down to cost, on paper external recruitment will cost more and external recruits will need to be given an on-boarding process to familiarise them with the business. However, over time the right candidate will be able to make a significant contribution and make a step change for the business through new methods of working, accountability and the identification of new opportunities.

Every business needs to manage the balance between internal and external recruitment but at senior level, sometimes it takes an outsider to come in and shake the tree.

Written by Adrian Berwick. 
Adrian is an experienced HR Professional who works exclusively with Macallam on the delivery of their Personal Career Transition Service
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Friday, 23 September 2016

Brexit and the Circular Economy




Having attended the RWM / Energy event last week, I was interested to update on latest developments with the Circular Economy, Energy from Waste and Recycling / Reprocessing / Waste sectors.   What became apparent is that whilst the UK is pushing to develop a circular economy there are huge opportunities in what is now becoming the Global Circular Economy.  This got me thinking.  Will Brexit (whatever Brexit means) have any impact on the objective of achieving a world where we reduce resources and extend the lifecycle of what we use and recycle as much as we can if we leave the EU?

For those unfamiliar with the terminology the circular economy is a modernised version of the old ‘reduce, re-use, recycle’ mantra with the objective of stripping out waste, streamlining supply chains and converting what we can into energy.  The market opportunity is huge and with the changes afoot the Global Circular Economy could be a $1 Trillion opportunity.  In the UK alone this could equate to £3-6 Billion and the creation of 50,000 jobs.  

All the respective sectors and businesses within those should all be contributing.  Ultimately we need to reduce the amount of waste going to landfill and I believe any businesses producing waste of any description has a duty to fulfil.  This then extends to the domestic world and peoples behaviours in their homes, buying habits in terms of purchasing what you need not what you think you need and everyone contributing to a less wasteful existence.  These behaviours are interchangeable as habits become the norm if practised often enough and what might be a move to reducing the weekly shopping bill at home can actually extend into achieving resource efficiency in business.

Education, Legislation and communication are key and it takes the leaders of business, Government (central and local) to push this down from above.  After all there are money making opportunities from the renewable sources of energy that can be created, the cost savings in reducing materials spend and reducing waste;  so why wouldn’t you?

It is more important than ever that we work together what with an ever increasing population, rising commodity and material prices and working through global supply chains to reduce firstly what’s purchased and then secondly what we send on a journey.  Making that process as efficient as possible is imperative in order to attain the goal.

What can be done when so much change is needed?  A start would be to ensure the best and right talent is being utilised to full effect.  Engaging experts in the field that can drive forward the agenda within companies seems to me to be a hugely important part of the achieving the goal.  Individuals without the distraction of day to day BAU that can push the difficult tasks and drive a cultural change within the business.  Additionally those responsible for the corporate social responsibility agendas in businesses have a great opportunity to drive a zero- waste and re-use culture which in turn will result in improved efficiencies and more profitable operations.   

There are of course many businesses now involved in the resource efficiency market from those involved in building and operating Energy from Waste plants, Recycling, Renewables and so on that are all running businesses and making profit from this. Waste has become a valuable resource and although we should all try to minimise it, it’s hugely important that it’s dealt with in the right way and in the right place.

The Waste sector has been driven by EU legislation for quite some time and it’s vital that the UK does not lose ground.  We need more progress.  Europe’s economy has created vast wealth in part attributable to the trend of improving and re-using resources.  Sub industries have grown and flourished and can go further across Europe and indeed globally.  It was in fact the UK that was an early adopter and leader in the EU of addressing environmental issues with the introduction of the Control of Pollutions Act 1974.  Whether or not Brexit will have any impact on this remains to be seen but it seems to me that as part of the mammoth task that lies ahead in terms of managing an exit (possible) from Europe, we need new legislation in place to reach our goal of attaining Zero waste businesses and ultimately cities to co-exist with the ensuing trade agreements that are going to follow.

Steven Wynne

For further discussions please contact Steven Wynne at steven.wynne@macallaminterim.com or telephone 01423 704155




Friday, 19 August 2016

Networking Tips

Networking isn’t just for the assignment search, when you’re coming to your contacts for an immediate payoff. Senior professionals need to make networking a part of their daily routine, not just an alarm they sound when it’s time to search for a new assignment.

Nevertheless, the move to an active assignment search is prime time to refresh your existing network, both online and off. The Internet has extended the reach and complexity of networking opportunities, but it hasn’t replaced the need for traditional human encounters. People need to know you, and you need to know people, to establish your credibility and get the inside scoop on new opportunities.
1. Navigating Your Network
Social networks like Facebook and LinkedIn haven't changed where you network so much as how.
Networking used to mean working the phones, attending industry events and trading business cards. It still does. But today you can augment and support those efforts with the click of a button in addition to the more traditional methods. 
LinkedIn is proving to be increasingly important so ensure your profile is a complete as possible and keep it up to date.
2. Alumni Networking Rules
Leverage your alumni association to find and win an assignment, but know the rules about what is and isn't fair play.
Alumni associations are a great jumping off point to networking, but it’s just the start. An Interim Manager seeking an assignment is still obligated to make a genuine connection before leveraging an alumni connection for a potential new assignment.
A simple introduction where you disclose that you’re available for your next assignment and just ask if they have any advice about the industry in general. A better way than a basic cold call would be to meet them through a mutual contact or via a regular alumni association networking event and start up a relationship from there.
3. Apply and Network in One Step
The next generation of job application software will let you see whom you already know at the company, so you can express your interest in helping a particular organisation and network at the same time.
There are many features from the leading automatic online job application software packages, and is being adopted by many HR departments. If you do submit your CV through these channels, you’ll be able to view potential connections between the organisation and your existing professional network.
They are able to link to your LinkedIn account to show you who in your network may be connected to someone at the organisation; that lets you follow up your application with an e-mail to a colleague to request a referral or set up an introduction to someone who can.
Referrals matter!  Studies have shown that more than 60 percent of jobs are filled through referrals. Employers fast-track job candidates who are recommended by current employees; statistically speaking, employee-referred hires prove to be better hires, have longer job tenures and therefore represent a far sounder investment on the part of employers.
4. The Interim Providers

You should be talking to all the relevant Interim providers that are likely to have assignments that are appropriate to your skill set and in the right sectors. If you haven’t always been successful through this route, it is a channel to market and should therefore be used as part of your networking activities.

Friday, 29 July 2016

TOP 5 MEETING TIPS FOR INTERIM ASSIGNMENTS

TOP 5 MEETING TIPS FOR INTERIM ASSIGNMENTS


If you're counting down the days till your next meeting for an assignment, these helpful hints will help you get in the right frame of mind in order to leave a lasting impression in the meeting and secure the assignment.

1. Do your research 
Preparation is the key to a successful meeting and to getting that assignment you desire.  It is the little things that make the big difference.  Fail to prepare, and prepare to fail.  You are certain to be asked specific questions about the company, so make sure you've done your homework on things like their last year's profits, employees, competitors and recent successes, contract losses, latest product launches etc.  Also take a look at the latest developments in the industry so you can converse with confidence if it’s a sector you are unfamiliar with. Doing some research on the individuals you are meeting is always a good idea to find common ground you can build on to quickly build rapport.

2. Practice key interview questions & answers 
Although there is no set format that every client meeting will follow, there are some questions that you can almost guarantee will crop up. You should prepare answers to some of the most common questions about your personal strengths and weaknesses, as well as being able to explain why you would be the best Interim for the assignment.  Build on past successes and what you did in a similar situation, what you delivered and the return on investment for the client.

3. Look the part 
Appearances shouldn't matter, but the plain fact is that you are often judged before you've even uttered a word. Make sure your shoes are polished; you have a smart business suit on with a crisp shirt and business tie.  After all you are in a business meeting and should dress appropriately.  

4. Stay calm 
Good preparation is the key to staying in control. Plan your route, allowing extra time for any unexpected delays, and get everything you need to take with you ready the night before.  Don’t oversell yourself.  Let your achievements speak for themselves but don’t come across as someone who is desperate for the assignment.  If you have been off assignment for a while, it’s not their fault.

5. Ask questions 
You should always have some questions for your interviewer to demonstrate your interest in the business. Prepare a minimum of five questions, some which will give you more information about the assignment, some which delve deeper into the culture and goals of the company and some that help scope the assignment brief and map out key objectives.

Good luck!