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8 HR Challenges UK Utilities Need To Address

     HR Services in the Utility and Construction Sectors 


The UK utility sector operates within a complex political, regulatory, and increasingly volatile technological, competitive and customer driven environment. HR practices need to adapt to address a number of key challenges.

1. Attracting Talent

Resourcing is seen as a key issue for utilities particularly in sectors such as Nuclear that are forecasting increased levels in employment. New skill sets will be required in areas such as IT, requiring utilities to compete with other sectors who may historically be better equipped to attract and retain IT talent. In the longer term a lack of STEM skills coming through the education system, a difficulty in attracting talent to an industry that historically has not been seen as an attractive career choice, and an aging workforce are all significant issues.

Youth engagement, apprenticeship and graduate programmes have been implemented in an attempt to manage future resource shortages. A greater focus on workforce planning, talent attraction, creating a strong employer brand and employee value proposition and reskilling existing employees are all seen as important in achieving current resourcing needs.

2. Increasing Diversity

Diversity has been identified as a factor in developing a resourcing solution and as good practice in reflecting the diversity within a utilities customer base. In general the approach taken has not been to promote positive discrimination or quotas but to source candidates from the widest possible talent pool and manage the unconscious bias in areas such as the selection process.

Many utilities have established diversity networks within their organisations and provided coaching to leaders to help them manage increasingly diverse and multi-disciplined teams. Recognising their influence as clients utilities have promoted diversity and local employment goals down through their supply chain. 

3. Leadership and Talent Management

Utilities have implemented talent management initiatives to identify and develop emerging leaders. Utilisation of talent assessment centres and high potential / high performance grids have been used to identify a leadership pipeline as part of a succession planning process.

4. Learning & Development

Utilities are creating a systematic approach to training with a heightened focus on giving the right training, to the right people, at the right time. There is an increased emphasis on developing the behaviours required with many utilities implementing “Behaviours for Success” programmes.

Training manuals and classroom-based methods are giving way to e-learning and on-line competency assessments. Use of 70-20-10 approaches aiming for 70% of learning to come from experience, 20% through learning from mentors and colleagues and 10% through formal learning are being adopted.

5. Retention

The utility sector has historically promoted employment security and experienced low employee turnover levels but this is starting to change. A new generation of employees are inclined to switch jobs much more frequently. This has led to utilities growing increasingly concerned with the prospect of losing highly trained staff and the associated impact on productivity and losing critical knowledge.

In response companies are focusing on employee satisfaction and engagement, improving “fit” and selection criteria at the recruiting stage, implementing improved knowledge management systems and undertaking exit interviews to better understand the reasons why employees leave.

6. Employee Engagement

There is a growing recognition of the link between customer satisfaction, a key focus for many utilities, and employee engagement. A particular challenge for utilities is generational diversity, for example a younger workforce in a call centre environment compared to an aging and technical workforce in other departments, creating very different motivations, attitudes and professional expectations.

Utilities are increasingly measuring and benchmarking engagement, with managers coached on their “soft” people skills and methods of communication, adopting a personalised approach by understanding the unique motivators of each employee and ensuring that people feel respected, involved, heard and valued.

An emphasis is being placed on how each person’s work contributes to the company purpose, providing better identification of career paths and developing a collaborative and caring work environment. Other important attributes for engagement in utilities include competitive compensation, effective technical and social on-boarding, opportunities for learning and personal development, defining expectations and goals, frequent feedback and recognition, task variety and empowerment,  flexible and family friendly practices and opportunities to give back through community volunteering programmes. 

7. Health, Safety and Wellbeing

Utilities typically give a high priority to health and safety which is being accompanied by an increasing emphasis on safety behavioural programmes and employee wellbeing. Utilities are seeing challenges associated with health absences due to increasing levels of stress and psychological wellbeing.

A particular challenge is recognised in the aging workforce, where reallocation of duties away from physically taxing roles, increasing flexible working practices to allow employees to work part-time and an increased attention to workforce ergonomics are being identified. Employee Assistance Programmes, return to work initiatives and wellbeing campaigns are being used to promote health and stress awareness in an attempt to address issues proactively.

8. Productivity

25 years on from privatisation significant improvements in productivity are evident, however, in an increasingly competitive environment and with UK productivity falling behind international benchmarks the utility sector recognises that further improvements need to be achieved.  A key challenge for utilities is how to achieve the most efficient outcome for customers while concurrently rewarding and motivating a highly skilled and committed workforce.

Process improvement, supply-chain management & collaboration, and measurement are important productivity factors. HR practices are also being implemented to increase productivity including workforce and succession planning, improvements to performance management, strengthening leadership and management capability, and employee training and development. Organisational structure and cultural changes, such as knowledge-sharing, a continuous improvement focus, increasing employee engagement and focusing on employee’s well-being are also being widely implemented.

How HR can adapt

Utilities recognise the importance of recruiting, retaining and developing a skilled workforce. Determining the HR practices to employ will depend on the contextual factors of the sector, culture of the company, and alignment with the strategic business objectives. There is however a growing recognition that HR practices should be less generic, more flexible and be made relevant to specific functions rather than taking a one size fits all approach.

The impact from increasingly competitive environments, use of data-driven analytics, feedback from more empowered customers, an accelerating rate of process and technology change, and changes in employee demographics and motivators will require implementation of effective and innovative HR practices. It is clear that HR needs to be given a central and strategic role if this is to be achieved.


A2O People

A2O People’s HR Consultancy integrates a range of services to help Employers to Recruit, Develop and Retain your employees. The business was founded on the premise that the utility and construction sectors have their own unique context that needs to be understood in order to implement and sustain effective HR solutions.

To learn more visit our People Consultancy page or call us on 01278 732073.

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