Avon Study Case sample essay

Provide a brief description of the status of the company that led to its determination that a change was necessary. In 2005, Avon Products success story turned ugly. After six straights years of ten percent plus growth and a tripling of earnings under CEO Andrea Jung, the company suddenly began losing sales across the globe. The company found itself challenged by flattening revenues and declining operating profits. While the situation had many contributing causes one underlying issue was that Avon had grown faster than portions of its infrastructure and talent could support.

As with many growing organizations the structure, people and processes that were right for a $5 billion company were not necessarily a good fit for a ten billion dollar company (Effron, 2005). Numerous cases existed in Avon’s existing talent and in its ability to identify and produce talent. While some of those gaps were due to missing or poorly functioning talent processes, an underlying weakness seemed to lie in the overall approach to managing talent and talent practices (Goldsmith M. &., 2010).

Neither managers nor associates knew how existing talent practices, performance management, succession planning, worked or what they were intended to do. Decisions on talent movement, promotions, and other key talent activities were often influenced as much by individual knowledge and emotion as by objective facts. The Human Resource department could not answer the most basic questions a manager might ask about talent practices, “What will happen to me if I don’t do this?” (Goldsmith M. &., 2010). There talent practice had no merit. There was no talent pipeline.

Identify the model for change theory typified in the case study of your choice. Discuss what led you to identify the model that you did. The change theory typified in this case study is the 360 degree assessment process along with performance management and/or succession planning this would deliver the expected results if they were consistently and flawlessly executed. They used this method to build talent practices that were easy to implement and a talent management structure that would ensure they were implemented. Disciplined execution could create a strong foundation for success (Effron, 2005).

The model of talent management that was proposed was integrated business and human resources strategy, talent management processes, and organizational culture; provides a systemic approach; and results in having talented leaders and individuals available to accomplish the mission of the organization.

One of the most simple and powerful changes was to bring as much transparency as possible to every talent practice. The talent management new practices had to be redesigned and existing ones using total transparency as the starting point. Transparency was only removed when confidentiality concerns out weighted the benefits of sharing information. The change in Avon’s 360 assessment process was a telling example.

Avon’s 360 degree assessment process was hardly a model of transparency when the turnaround began. The new team leader requested copies of each vice president’s 360 degree assessment with the goal of better understanding any common behavioral strengths and weaknesses. A new much simpler 360 was designed and implemented that explicitly stated that proper managerial and leadership behaviors were critical for a leader’s success at Avon (Goldsmith M. &., 2010).

Citing that level of importance, the disclosure to all participants and respondents state that the 360 information could be shown to the participant’s manager, HR leader, regional talent leader and anyone else the Avon’s HR team decided was critical to the participant’s development.

It stated that the behavioral information could be considered when making decisions about talent moves, including promotions or project assignments. Helping to make the transition to transparency easier, the new 360 assessments and report differed from typical tools that rate the participants on proficiency in various areas. The Avon 360 borrowed heavily from the “feed-forward” principles of Marshall Goldsmith (Goldsmith M. &., 2010).

Illustrate the types of evaluation information that were collected and how they are used to benefit the company.nThe type of evaluation information that was collected was from complex to simple, from egalitarian to differentiated, from episodic to disciplined, from meaningless to consequential, from opaque to transparent, from emotional to factual and from meaningless to consequential.

Leaders know what is required to be successful, how to measure the situation, how HR and management can assist them, and the consequences of higher and lower performance. They know their performance rating, their potential ratings and how they can change each of those. They actively differentiated levels of Avon talent and provided each level with the appropriate experience. Their highest potential leaders understand how management feels about them, and they see a commensurate investment. Their lower performing leaders get the attention they need (Silzer, 2010).

Managers do the right thing for their associates both because the barriers have been lower than what they previously built and because management helped them with value added tools and information. Processes began to happen on schedule and consistently around the world. Talent decisions are made with an additional layer of qualitative and quantitative information drawn from across many different leader experiences. Leaders know that they must build talent the Avon way for both their short and long term success.

When the turnaround d began, no global process for understanding or acting on associate engagement t issues existed. Select regions or department made efforts of varying effectiveness, but there was no integrated focus on consistent measurement and improvement of engagement (Silzer, 2010). In designing the engagement process, management applied the same three questions: the business benefit, the simple path, to adding additional value. Management accepted the substantial research that showed a correlation, and some causation between increasing engagement and increasing various business metrics.

There were two goals established around simplicity. One goal was to understand as much of what drove engagement as possible, while asking the least number of questions. The second goals were to write the questions as simple as possible, so that if managers needed to improve the score on a question, their options for action would be relatively obvious. The final version of the survey had forty-five questions, which explained 68 percent of the variance in engagement. There questions were quite simple, which had some value in itself, but their true value was multiplied tenfold by the actions described below (Silzer, 2010).

Management was confident that if managers took the right actions to improve their engagement results, not only would the next year’s scores increase, but the business would benefit from the incremental improvement. The challenge was to determine and imply communicate to the managers what the right actions were. Management with the assistance of a research team developed a statistical equation model that would become the engine to produce the answers (Goldsmith M. &., 2006). The statistical equation model allowed them to understand the power of each engagement dimension, for example, immediate manager, empowerment, senior management, to increase engagement, and to express that power in an easy to understand statement.

Speculate about success of the changes within the next five (5) years and how adjustment could be made if the results become less than ideal. Avon’s mission is focused on six core aspirations the company continually strives to achieve. They are leader in global beauty, building a unique portfolio of beauty and related brands, striving to surpass competitors in quality, innovation, and value, and elevating Avon’s image to become the world’s trusted beauty company. Learn more about Avon’s brands.

Empower their employees to achieve economic independence by offering a superior earning opportunity as well as recognition, service and support, making it easy and rewarding to be affiliated with Avon (Jones, 1986). Deliver superior returns to shareholders by pursuing new growth opportunities while maintaining a commitment to be a responsible, ethical company and a global corporate citizen that is held as a model of success. Elevate the company’s leadership, including its high standards, respect for diversity, and commitment to helping associates achieve their highest potential in a positive work environment (Jones, 1986).

The specific talent practices are targeted to see significant improvements in effectiveness. Rating of immediate manager, including items such as clear goal setting, frequent feedback, and development planning, and should increase up to 17 percent, with directors and vice presidents giving their immediate managers nearly a 90 percent approval rating. The rating of “people effectiveness” which requires many HR and talent practices (Goldsmith M. &., 2006), should show an increase up to 16 percent, including strong gains on questions related to dealing appropriately with low performers and holding leaders accountable for their results.

While these changes are had fought and are created much more effective processes, a more important set of metrics exists. Avon has achieved its entire expense savings goals since the start of the turnaround and has recently reinforced its commitments to even greater expense reductions. Even with this lower cost base and ten percent fewer associates, Avon has grown from revenues of $8 billion in 2005 to nearly $11 billion in projected 2009 revenues while delivering strong single digit earnings growth (Goldsmith M. &., 2006). The talent practices now in place should deliver better leaders, faster, to help Avon meet its business goals.

References:

Effron, M. G. (2005). Growing Great Leaders: Does It Really Matter? Human Resources Planning Journal , 18-23. Goldsmith, M. &. (2010). Best Practices in Talent management : How The World’s Leading Corporations Manage, Develop, and Retain Top Talent. San Francisco, CA: Pfeiffer. Goldsmith, M. &. (2006). Coaching For Leadership. San Francisco, CA: Pfeiffer. Jones, C. (1986). Programming Productivity. New York, N.Y.: McGraw-Hill. Silzer, R. &. (2010). Strategy-Driven Talent Management: A Leadership Imperative. San Francisco, CA: Jossey-Bass.