A lot has been happening at Roche in the six months since the last issue of our newsletter appeared. The implementation of Operational Excellence, continued integration of GNE and Roche and the discussions on the new Performance Management & Compensation (PM & Comp) strategy are examples that come readily to mind.

The AVR is closely involved not only in these projects, but in initiatives such as Harmonization Switzerland (harmonization of employment conditions), Roche – A Great Place to Work, Opportunity Management, Roche Induction Days for new employees and Bike to Work. All these activities generate a heavy workload.

And then there was the two-day workshop the AVR’s executive board members had to attend on Operational Excellence in February and also a three-day offsite meeting in June.

In this issue you’ll find more on Operational Excellence, including a piece on how the initiative is being implemented in the employee reorientation centres.

The new PM & Comp strategy, which will be implemented in January 2012, has also generated a lot of discussion and required quite a few meetings with HR and project leaders in order to clarify various questions. In this issue you can read the AVR’s statement on the topic, which has also been sent to HR and Group Management.

Roland Frank

President

Many of our colleagues may have been waiting for quite some time for a statement from the AVR regarding Operational Excellence. However, we have deliberately held back any comments until we could be sure that we would find a solution, or could offer at least a perspective, for the majority of colleagues who were affected by OE.

The announcement of OE in October 2010 marked the beginning of a challenging time for the AVR. On the one hand, a task force had to be set up together with site management and the Head Human Resources Basel, and which aimed at developing a good social plan. Many colleagues confirmed that this target has been reached, thanks to rigorous negotiation. Employees affected by OE welcomed the options of either receiving a generous severance package based on seniority, or being able to choose the time factor, meaning they could extend their employment contract while actively looking for a new position. On the one hand colleagues looking for a new job were enabled to benefit from a longer period of time during which they received support, on the other hand quite a number of senior employees were able to retire early with advantageous conditions.

A good social plan was one of the important targets the AVR was aiming to achieve. Equally important was the plan of reducing the number of affected employees already in the early phase of the advance notice. Already in November counseling interviews were held in various areas where the responsible line managers of the different functions discussed upcoming changes with the AVR and AK. The AVR has summarized the results of these counseling interviews in a 35-page statement containing the following central points:

• A critical evaluation whether the proposed measures will lead to sustainable and future-oriented process improvements and increase in efficiency, or whether they represent only short-term savings.
• Extension of the period of time for OE implementation in order to work out optimal long-term solutions and make use of natural fluctuation instead of dismissing staff.
• Retention of well-practiced teams and know-how in order to stand up to upcoming challenges.
• Favor the option of early retirement for senior staff to allow for continued employment of younger, qualified staff.
• If lay-offs cannot be avoided, intensive support should be given to affected staff, and the internal job center should actively help the individuals find open positions

In mid-January the AVR was given access to the listings of the different departments and noted as a positive development that the number of affected employees in Basel had already notably decreased, e.g. 32 in the pRED area, thanks to a variety of measures taken. However, the numbers were still much too high, so that the AVR task forces assigned to different departments critically challenged the planned lay-offs. In Roche’s 18-page statement the company communicated that the OE measures had been developed with moderation and the necessary due diligence, and that the AVR’s proposals other than the social plan could not be taken into consideration.

Thus, AVR board members focused on individual counseling interviews for employees affected by OE who had received their advance notice; the AVR was able to explain the implementation of the social plan and impart assurance and confidence regarding the reorganization of the company. The personal support given in the two reorganization centers (ROC’s; Eisenbahnweg and Picassoplatz) contributed to this effort. AVR representatives visit both ROC’s on a monthly basis and bring back proposals, worries and needs of the affected employees. At the request of the AVR, workstations were equipped with Windows 7 / Office 2010, and training courses such as computer, GMP and English training are now being offered.

To date, the AVR representatives are involved in follow-up talks with Human Resources where the individual implementation of OE measures are critically scrutinized and updated. Although the company assures us in their statement that job reductions are done prudently and with a view to retaining important know-how and functions, we feel that in some cases decisions were taken too fast, and potential negative consequences were not taken into consideration. Although we welcome the preservation of every position, some employees initially had to cope with the stress caused by OE, only to be re-hired a few days later into a similar position within the same department. Originally, the intention had been to give all colleagues affected by OE the same opportunity, but as a result individuals were faced with stressful situations, and the workforce went through a process of uncertainty. Instead of planning an internal reorganization in due time and with the help of job advertisements and internal application procedures, both OE-affected staff and departments had to undergo tense times.

The AVR wishes to thank the Human Resources department for the intense dialogue and the good collaboration regarding the implementation of OE. The AVR will continue to critically assess the process since almost one third of the originally announced job reductions have not been implemented as yet. We will continue to act as contact persons and offer our support to all colleagues affected by OE.

AVR Executive Board

Roche employees were recently informed about the new Performance Management and Compensation Strategy.

Over the last few months a number of organizational changes have been implemented within Roche, including the preparation of a new standardized concept for performance evaluation and compensation.

To date, different practices and regulations have resulted in inconsistent and complex systems. The extensive reorganization of the company as well as enhanced globalization requires a reinforcement of Compensation Management in order to support the new strategic guidelines.

The introduction of the new concept aims at achieving the following goals:

• Enable employees to benefit from the company’s strong performance.
• Establish a stronger link between individual performance and compensation.
• Concentrate on overall performance, on “what has been achieved” and “how has a goal been achieved”.
• Uniform processes throughout Roche enabling a fair assessment of performance.

The AVR’s executive committee has closely scrutinized all aspects of the new PM & Compensation concept and believes that it should be fully supported, especially with a view to the following positive aspects:

• Employees’ main responsibilities regain great importance and impact the assessment of performance during appraisal interviews.
• Employees receive ongoing feedback from their superiors throughout the year, not just once or twice a year.
• Enhanced flexibility in the face of a changing business environment.
• Calibration aims at bringing together different assessment criteria used by individual superiors and departments.

The AVR believes that the successful implementation of the new concept requires a few prerequisites:

• The next higher organizational levels must know the employees they are responsible for, and their roles and responsibilities. This is all the more important if employees are working at different sites, e.g., members of global teams or project teams.
• Line managers need to familiarize themselves in due time with the new multi-feedback tool.
• Clear communication on what is expected from employees, and especially continuous and candid feedback.

During the introductory phase this will inevitably result in an extra time effort, however, the HR Business Partners assigned to your area will provide guidance and support.

Gernot Scharf,

Since a detailed report on the subject has appeared in Roche News, you may already know that Roche is thinking of making Opportunity Management an integral part of its development portfolio. Once HR had defined the objective and teaching content, and had assembled this information into courses, the first training sessions for managers were held at the end of last year.

Another key component (integrated in the development portfolio) is a half-day training session for managers, designed to enhance their knowledge and thereby actively promote the success of employee development. In view of the plans to hold pilot courses for employees with no managerial responsibility, the AVR set up a working group, whose members were able to attend these courses personally to get a first-hand impression. The group offered the project team its assistance in optimising the courses. We are pleased to report that a frank exchange then took place, during which our suggestions and criticisms were taken on board.

Here as a reminder are the titles of the courses on offer during the pilot project:

• Introductory day
• Developing perspectives
• Successful positioning
• Situation assessment
• Preparing documents correctly
• Networking
• Coping with resistance
• The marketplace

In general, our feeling about the courses and the idea behind them is a positive one. The variety within and between the individual modules makes them interesting, they promote new ideas and points of view and encourage participants to play an active part in changing their own situation and moving their career forward.

‘The marketplace’ was definitely the module that people were looking forward to most. When expectations are so high, there is a lot of room for disappointment. But that's what pilot projects are for: to enable people to learn from mistakes. There needs to be enough time at the end to allow everybody to introduce him- or herself and get to know people. The emphasis needs to be on information about job content, and interesting, real offers need to be made, particularly for employees with no managerial responsibility.

The information provided during the courses is intended to give participants a better chance of finding a new job within the company and at the same time to equip people better in case they are forced to find a new job outside the company. After OE we naturally hope that Opportunity Management will find a place at Roche primarily as preparation for voluntary internal transfers.

We expressed to the Opportunity Management project team our concern that managers could misinterpret their reports’ interest in development as a lack of interest in their current job, for example, or stand in their way in order to stop good people moving on, and we hope that raising the subject again at management level, as is planned, will have the desired effect.

If people understand that employees who are keen to learn and to change represent added value for Roche in the longer term, then we are on the right path with the change in culture that we are aiming for. Managers have to see the benefits of being generous, open and encouraging towards employees who embrace change, and of separating a smoothly functioning team so that individual employees have a chance of personal development. Of course the performance of the people who are left behind can suffer if one member of the team leaves, but, on the other hand, the person who fills the vacant position might be just as good or even better, and will bring new ideas into the team.

We wish the Opportunity Management project team every success with implementing the project and want to thank them for the excellent collaboration. We would also like to take the opportunity to wish everyone who takes part in the course a successful future.

AVR working group on Opportunity Management:

Birgit Detje, Claudia Dietrich,  Beat Hess