I employ 1,200 people and have no HR department [video](bbc.com)
bbc.com
I employ 1,200 people and have no HR department [video]
https://www.bbc.com/news/av/business-56130189
75 comments
previously: https://news.ycombinator.com/item?id=26248154
Rough transcript:
The question we asked ourselves was, are companies with big H.R. departments full of happier people, are they more productive? Well, the answer is usually no. You know job adverts always saying we're looking for creative people. You can take responsibility who's got passion for customers and all that stuff. And yet when people start working for a company, the first thing the company does is drown them in processes and bureaucracy. Now, actually, if you're going to go around recruiting smart people who are talented and motivated and really want to make a difference for customers, the most important thing a company can do is free them up to deliver that stuff that, you know, is magic about humans. If you spend all of your time at work, whenever there's something difficult handing onto another function rather than learning to do it yourself, it's less fulfilling for you. But it's also means the company getting less out of you. You know, how can a company learn how to find better ways of dealing with things if it takes all of the intelligence of its people and diverts them from from those big problems?
The question we asked ourselves was, are companies with big H.R. departments full of happier people, are they more productive? Well, the answer is usually no. You know job adverts always saying we're looking for creative people. You can take responsibility who's got passion for customers and all that stuff. And yet when people start working for a company, the first thing the company does is drown them in processes and bureaucracy. Now, actually, if you're going to go around recruiting smart people who are talented and motivated and really want to make a difference for customers, the most important thing a company can do is free them up to deliver that stuff that, you know, is magic about humans. If you spend all of your time at work, whenever there's something difficult handing onto another function rather than learning to do it yourself, it's less fulfilling for you. But it's also means the company getting less out of you. You know, how can a company learn how to find better ways of dealing with things if it takes all of the intelligence of its people and diverts them from from those big problems?
According to Linkedin there are 25 HR employees at his company Octopus Energy. Their roles are Learning & Development, Talent Acquisition, Onboarding, Payroll Management. These are all roles that are typically taken on by the HR department.
He has an HR department whether he calls it like that or not.
He has an HR department whether he calls it like that or not.
HR’s closest department in responsibility is Legal, both serve to protect the company, not its employees. So I can see the argument that you don’t need HR if you have a legal department, have it train managers to handle employee grievances properly, and let each manager deal with vacations, sick leave etc as they see fit.
And finance can handle ordering computer equipment and network management services, get rid of IT as well.
And finance can handle ordering computer equipment and network management services, get rid of IT as well.
There's a lot more to IT than just ordering equipment. Also, no finance person in my entire working history ever knew anything about managing a network. They can barely use Excel in my experience. The flip side is that no IT person I know could do accounting.
Some things you just can't double up roles on.
Some things you just can't double up roles on.
It depends on your network needs. Most are easily outsourced, which is a perfect fit for Finance/Operations personnel.
If your team needs a custom network solution, it’s probably better managed by your team. Keep important decisions close.
If your team needs a custom network solution, it’s probably better managed by your team. Keep important decisions close.
That is one view at it. The other one is, that hr is a strategic partner to ceo in terms of organizational behaviour and its fit to the strategy. The former appears dominant in US, the latter in EU.
He may think he doesn't have an 'HR department', but whoever holds the pen on his holiday policy, equipment policy, training & development policy, maternity & family friendly rights policy, expenses policy - well, there's his HR department.
Not having an HR department doesn't mean you don't have HR and no one is claiming that. The entire point is that you don't need a department to do those things and the argument presented here is that those responsibilities are left integrated within a team rather than compartmentalized into a separate and independent system.
That’s exactly how HR departments formed... you can distribute their functionality across the company and guess what it will cause issues that would lead to an HR department forming.
His managers handle that for their own employees.
That sounds like a lawsuit waiting to happen. All it takes is one bonehead. Not even a bonehead really, I don't want to try to maintain any semblance of technical acumen in my role and take care of the folks that I support and know all the intricacies of labor-related laws and standards.
What makes HR immune to having 'boneheads' in any other company? If your risk is 'someone might be a bonehead' then having HR as a separate department doesn't help does it?
Possibly, but if you have a separation of duties with the manager and HR tasks, you’re more likely to have someone go to bat for you when one gets out of line.
When it all goes through a single person, there’s less of a balancing force there.
Both obviously can be abused.
When it all goes through a single person, there’s less of a balancing force there.
Both obviously can be abused.
Nothing but as a manager I wouldn’t want to deal with clearly HR related issues alone.
Form a managers perspective I see HR essentially as your legal counsel, if the company wants to delegate that to the legal department sure but they’ll be likely overpaying those who’ll be tasked with dealing with HR issues all day long.
Form a managers perspective I see HR essentially as your legal counsel, if the company wants to delegate that to the legal department sure but they’ll be likely overpaying those who’ll be tasked with dealing with HR issues all day long.
You have a legal department to guide you on legal issues, from harassment to mandated leave.
So, they're manager and HR.
Ok, so now you understand what the article is saying. No HR department.
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Full article https://www.bbc.co.uk/news/business-56130187
> But it is a single, personal incident, which haunts him to this day, that really underpins his management philosophy.
"When I was 27, I was managing a manufacturing business in north London and there was a woman who ran the reception and also did customer service, who was in her 40s," he remembers.
"One day I heard her speaking to a customer on the phone and I thought I could help, so I leaned in and gave her some wise words.
"She finished the call, like a consummate professional, and she turned to me and said: 'Greg, I bring up two boys and a husband on the poxy wage this company pays. If I can do that, you can be pretty sure I can do anything this company wants from me. And by the way Greg, I was here before you were here and I'll be here after you have gone. I love the company more than you do, so you never need to tell me what to do.'"
Jackson was stunned into silence because she had just given him - her boss - an incredible dressing down.
"I realised she was right, and I remember I gave her a hug. It was one of the greatest learning experiences of my life and it forms the basis of my management theory today."
The episode taught him to favour a hands-off approach that lets individuals and teams sort their own affairs as much as possible without interference from above.
"When I was 27, I was managing a manufacturing business in north London and there was a woman who ran the reception and also did customer service, who was in her 40s," he remembers.
"One day I heard her speaking to a customer on the phone and I thought I could help, so I leaned in and gave her some wise words.
"She finished the call, like a consummate professional, and she turned to me and said: 'Greg, I bring up two boys and a husband on the poxy wage this company pays. If I can do that, you can be pretty sure I can do anything this company wants from me. And by the way Greg, I was here before you were here and I'll be here after you have gone. I love the company more than you do, so you never need to tell me what to do.'"
Jackson was stunned into silence because she had just given him - her boss - an incredible dressing down.
"I realised she was right, and I remember I gave her a hug. It was one of the greatest learning experiences of my life and it forms the basis of my management theory today."
The episode taught him to favour a hands-off approach that lets individuals and teams sort their own affairs as much as possible without interference from above.
Something doesn't seem on the level with this article.
The photos are copyright Greg Jackson and Octopus Energy. The office shot is too idealised.
The last statement should be a direct quote, but it is written as a statement of fact:
> The episode taught him to favour a hands-off approach that lets individuals and teams sort their own affairs as much as possible without interference from above.
This seems like his PR team has fed the article to the journalist, who has complied by publishing what they wanted, without researching the veracity by interviewing staff independently.
The photos are copyright Greg Jackson and Octopus Energy. The office shot is too idealised.
The last statement should be a direct quote, but it is written as a statement of fact:
> The episode taught him to favour a hands-off approach that lets individuals and teams sort their own affairs as much as possible without interference from above.
This seems like his PR team has fed the article to the journalist, who has complied by publishing what they wanted, without researching the veracity by interviewing staff independently.
What are you supposed to do if the 40 year old woman really was doing something wrong though? I realize in this instance she wasn't, but what if she wasn't a consummate professional capable of anything the company needed but just thought she was?
Yeah, we don't get to find out because they don't supply any examples of problems anywhere in the article.
With good policies and good people, you don't need "HR". I would argue he has HR just without a centralized department. Although either way, the only good HR is no HR.
HR sucks.
HR sucks.
Your privilege is showing.
I think that the thing to keep in mind here is that HR, like legal, isn't for when things are going well. This comment sort of assumes that you'll never have a harassment problem, nobody will ever have an issue with getting their FMLA "approved", and the company will never have a performance problem that requires letting someone go in a way that won't get you sued.
These things all happen, and there's a lot of No True Scotsmanning in the idea that they only happen to bad companies/people.
Edit: I don't like HR either, but I'm very unlikely to need them to keep my boss from harassing me.
I think that the thing to keep in mind here is that HR, like legal, isn't for when things are going well. This comment sort of assumes that you'll never have a harassment problem, nobody will ever have an issue with getting their FMLA "approved", and the company will never have a performance problem that requires letting someone go in a way that won't get you sued.
These things all happen, and there's a lot of No True Scotsmanning in the idea that they only happen to bad companies/people.
Edit: I don't like HR either, but I'm very unlikely to need them to keep my boss from harassing me.
It sounds like you think HR la job is to prevent harassment, instead of protecting the company against employees who claim harassment.
What if I told you that preventing harassment is the best way to protect the company from harassment claims?
Just because some people in HR suck and don't do this doesn't mean that's not what their job is a.
Just because some people in HR suck and don't do this doesn't mean that's not what their job is a.
If they can’t and won’t prevent harassment it doesn’t matter what they claim their job is.
Many can and do. My source for this is personal experience of watching coworkers successfully get HR to intervene.
As I have repeatedly said on this thread, some HR people being bad does not mean that isn't what HR does/is supposed to do. You're painting with an inappropriately large brush here.
As I have repeatedly said on this thread, some HR people being bad does not mean that isn't what HR does/is supposed to do. You're painting with an inappropriately large brush here.
HR doesn’t work for you, the fact that you’ve witnessed a few random cases where they helped coworkers doesn’t change that.
My experience is that HR conspires with managers to serve their aims, so why not just deal with your manager?
My experience is that HR conspires with managers to serve their aims, so why not just deal with your manager?
Your experience is irrelevant.
I don't interface with people who say things like "Your privilege is showing"
Its such an adversarial and sanctimonious position. You know absolutely nothing about me.
Its such an adversarial and sanctimonious position. You know absolutely nothing about me.
Please take a moment to reflect on the extreme irony of going out of your way to tell me that you're not going to "interface"(???) with me. Then consider the definition of the word sanctimonious.
Everyone has blind spots created by the confluence of their intrinsic and environmental characteristics. Pointing out where someone might be missing something because it doesn't apply to them has nothing to do with moral superiority. Conversely, declaring that you won't _interact_ with people who say certain things is pretty preachy and adversarial.
Everyone has blind spots created by the confluence of their intrinsic and environmental characteristics. Pointing out where someone might be missing something because it doesn't apply to them has nothing to do with moral superiority. Conversely, declaring that you won't _interact_ with people who say certain things is pretty preachy and adversarial.
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As said elsewhere on HN - HR departments are ultimately there to protect the employer, not the employees. This is fair enough, but not how HR departments advertise themselves.
This has very little content (1 minute video). I can imagine why it would be advantageous but it would be great to hear more about how it has worked.
Some more information, not a lot though. It’s mostly marketing I would say.
https://www.bbc.co.uk/news/business-56130187
https://www.bbc.co.uk/news/business-56130187
More here:
https://www.bbc.co.uk/news/business-56130187
But this is all very vague and hand-wavy as to how specialist functions, skills and knowledge are provided especially with regard to legal compliance, and tech types rubbing their hands in glee should note that he dismisses IT departments as well.
It seems there is a more nuanced philosophy here that there may be useful lessons to draw on but it isn't detailed in these articles.
https://www.bbc.co.uk/news/business-56130187
But this is all very vague and hand-wavy as to how specialist functions, skills and knowledge are provided especially with regard to legal compliance, and tech types rubbing their hands in glee should note that he dismisses IT departments as well.
It seems there is a more nuanced philosophy here that there may be useful lessons to draw on but it isn't detailed in these articles.
I was skeptical until you said he dismisses IT Departments, now I really like this guy.
HR gets a lot more hate than they deserve.
I've built several startups, and I do get the the whole "we don't need no stinking HR to tell us how to treat people!" vibe. It's definitely true at small companies and one of the great things about startups.
But it doesn't scale.
Onboarding a new employee at a larger company involves coordination with IT (laptop and account setup), security (badges and access), legal, accounting (payroll and tax info), and a bunch of things I probably don't even know about.
If I had had to put all my work on hold and do this myself for each new employee, my productivity would plummet.
Also, it's not my job to understand the nuances of labor law or how it's reflected company policy. If a team member asks me, for example, "Does my broken arm qualify me for disability accommodation?" I want to have an expert I can refer them to rather than having to go on somme corporate scavenger hunt to get the answer.
I've built several startups, and I do get the the whole "we don't need no stinking HR to tell us how to treat people!" vibe. It's definitely true at small companies and one of the great things about startups.
But it doesn't scale.
Onboarding a new employee at a larger company involves coordination with IT (laptop and account setup), security (badges and access), legal, accounting (payroll and tax info), and a bunch of things I probably don't even know about.
If I had had to put all my work on hold and do this myself for each new employee, my productivity would plummet.
Also, it's not my job to understand the nuances of labor law or how it's reflected company policy. If a team member asks me, for example, "Does my broken arm qualify me for disability accommodation?" I want to have an expert I can refer them to rather than having to go on somme corporate scavenger hunt to get the answer.
At this size u need HR just to deal with holiday requests and sick leave.
Not if you let managers actually "manage" their team and capacity. You don't need to manage sick leave if you don't have sick leave and just let people take time off when they're sick and treat them like, you know, adults. I'm sure a manager is also better equipped to know when someone is taking advantage, as opposed to some HR person who's never even seen the employee.
Thanks but no. Managers have their favorites. As young single male I am always expected to pick up the slack for lazy colleagues without compensation. I will take my chances with HR.
There's shitty managers and there's shitty HR. The existence of one doesn't preclude the existence of the other.
I'd tell you to stand up for yourself if that's happening to you, but it won't matter because HR isn't on your side anyway.
I'd tell you to stand up for yourself if that's happening to you, but it won't matter because HR isn't on your side anyway.
That’s crazy that you think that HR would do anything other than back up your biased manager to the hilt.
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Having worked and managed in several companies of this size I have no idea why you would need an HR dept to manage that. Easily the job of manager owned tool, secured spreadsheet, or some simple vendor supplied thing. Easily a self serviced thing.
Or just delegate down to the employee's direct supervisor.
You need HR when someone has a harassment claim against a coworker, or their boss. Some third party not in their chain.
You need HR when someone has a harassment claim against a coworker, or their boss. Some third party not in their chain.
Having 150 people do HR tasks means you have 150 different versions of vacation policies.
In large companies that works, because there's an actual HR department that writes the ironclad rules that the direct supervisors follow. Not sure how it works in a wild-west ad-hoc environment like this one.
In large companies that works, because there's an actual HR department that writes the ironclad rules that the direct supervisors follow. Not sure how it works in a wild-west ad-hoc environment like this one.
Isn't that a good thing? Each team has its own vacation policy that suits them, instead of some rules imposed on them by HR department.
At that point, why have 1,200 people in a single company? Why not have each team hire each other team as contractors?
(This isn't sarcasm, I actually do vaguely suspect the world would be a better place if we did this.)
(This isn't sarcasm, I actually do vaguely suspect the world would be a better place if we did this.)
It's like microservices: the company, with all the downsides that come from higher transaction latencies between component parts.
Economics of scale would also be lost, if you had to do all the book keeping, IRS reporting, etc etc for 120 companies of 10, instead of one company of 1200.
Economics of scale would also be lost, if you had to do all the book keeping, IRS reporting, etc etc for 120 companies of 10, instead of one company of 1200.
Well, you could outsource those, right? Like isn't this basically the point of services like Stripe Atlas or Pilot - that it should be easier to run a company of 10, with almost all of those 10 people working on the actual product?
In fact, outsourcing HR in particular is a well-established field - it's what companies like ADP do.
Just like there's a happy ground between one massive monolith and multiple microservices per engineer, I think there's a happy ground between a 1200-person company and a bunch of sole proprietorships. It may not be 10; it might be 50. There are a huge number of <50-person companies in the world and they seem to be fine. In many cases, groups of these companies can execute faster than a 1200-person company can, because there's less internal hierarchy involved. (In much the same way that avoiding microservices doesn't mean you have no problems of interoperability, it just means they look different.)
In fact, outsourcing HR in particular is a well-established field - it's what companies like ADP do.
Just like there's a happy ground between one massive monolith and multiple microservices per engineer, I think there's a happy ground between a 1200-person company and a bunch of sole proprietorships. It may not be 10; it might be 50. There are a huge number of <50-person companies in the world and they seem to be fine. In many cases, groups of these companies can execute faster than a 1200-person company can, because there's less internal hierarchy involved. (In much the same way that avoiding microservices doesn't mean you have no problems of interoperability, it just means they look different.)
Or call it by a different name, but doing the exact same functions
We have an app for that.
Anecdotal but I know someone who works on the software engineering team at Octopus, and in their experience there’s way too much micromanagement, and minimal empowerment from engineers to apply their own judgment.
the point being that narrative and reality are not the same thing.
the point being that narrative and reality are not the same thing.
This is a terrible idea in the current state of the tech industry, where plenty of highly skilled tech specialists are “promoted” to positions managing people, without the training or emotional intelligence to handle what an HR department can handle.
I'm not sure how meaningful this is, HR is hardly rigidly defined, it can be anything from outsourced to including functions like payroll and so being unavoidable.
I'm glad Octopus is a company like this though, considering itself edgy I suppose I mean, and having 1k2 employees rather than being just an almost empty shell as are many energy companies. For the unacquainted: it's rather HN-friendly - its tracker plan is updated daily rather than monthly or less frequently as most are, and it also has an 'Agile' plan with an API and hourly pricing. (I'm not a customer, just like the idea of it, perhaps soon.)
I'm glad Octopus is a company like this though, considering itself edgy I suppose I mean, and having 1k2 employees rather than being just an almost empty shell as are many energy companies. For the unacquainted: it's rather HN-friendly - its tracker plan is updated daily rather than monthly or less frequently as most are, and it also has an 'Agile' plan with an API and hourly pricing. (I'm not a customer, just like the idea of it, perhaps soon.)
No company at that scale will function without people taking care of all the HR and IT functions. Sure it doesn't have to be traditional, there doesn't have to be a department responsible for it, but it has to be done - and you need a lot of manpower to do it. Hence why you usually have departments dedicated for those tasks. You might call it something different or distribute their responsibilities down the chain but it will still exist.
Makes for a good headline though, who doesn't hate HR and IT...
...always getting in our way of running random code on our machines or coming to work without pants /s
Makes for a good headline though, who doesn't hate HR and IT...
...always getting in our way of running random code on our machines or coming to work without pants /s
I’ll counter argue that IT and HR sap enough productivity out of the workforce that the work they do is a net negative.
Good HR is really good. But most places, especially bigger firms, have mediocre or bad HR. That's worse than nothing. Either do it properly or don't do it at all.
If you have HR people, you'll have HR problems
Absolulty nothing helpful about that video...
As my boss says: “HR is not your friend.”
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Good luck Greg
I feel like an HR department is one of these bureaucratic components where its stated purpose is different than its essential purpose to the business, and it would be hard to replace without accurately modeling this hidden essential purpose and precisely replicating it on a smaller scale. If you just conduct the stated functions of HR through your CEO office, you may not capture the essential function and it may not work out.