Culture has been at the heart of far-reaching business transformation at Jacobs, writes Shelie Gustafson
Transformation starts with culture. This has been the reality for us at Jacobs on our journey to evolve from an engineering and construction firm to a technology-forward solutions provider. The journey started when Steve Demetriou was hired as the Jacobs chair and chief executive. It didn’t take long for Demetriou and other executives to recognize that a transformation was critical if the company was to grow and compete in a rapidly changing global arena.
“When I joined Jacobs in 2015, I worked with our leadership team to redefine our strategy. There was a lack of growth and challenges associated with mergers and acquisitions, and it was time for a change,” says Demetriou. “We set a foundation around three constructs as we moved forward with our new strategy in 2016: build a high-performance culture; transform the core; and grow profitably.”
As a professional services organization, revenue at Jacobs is generated largely by talent, with 52,000 people in 40 countries. We needed to transform from the inside out, with culture at the core of our strategy. The initial strategy set in motion our acquisition of CH2M at the end of 2017, followed by the divestiture of our energy, chemicals and resources business, and by additional acquisitions in 2019 – all of which increased the intensity of the required cultural transformation.
The approach to culture change
“The CH2M acquisition was a pivotal point. We all know that most mergers and acquisitions don’t live up to their stated objectives, and usually this is because of a failure to align the two organizational cultures,” says Ben Almond, now vice-president of Canada operations for Jacobs – and, as a CH2M employee, a member of the integration team. “Many employees had spent their entire careers with CH2M, and there was also the shift from an employee-owned to a publicly traded company.”
Demetriou and his team committed to leading the CH2M integration differently. Culture change was core to the successful integration of the two companies. As one of the key workstreams of the integration management office, executive sponsors from both companies came together to lead the effort.
Inspiration, inclusion and innovation were identified as the three pillars of Jacobs’ culture transformation. Research shows that innovation comes from people with different experiences, backgrounds and thought processes. Just putting a group of people in a room isn’t enough: how they work and think together makes the difference. Inclusion unifies and is the activator of Jacobs’ diversity, which is why we put the ‘I’ before ‘D’ – inclusion and diversity. We must be exceptional at creating an environment where all employees feel valued, have a sense of belonging and can be their best. Helping individuals be their best selves, with the team capitalizing on their uniqueness, is a game changer.
Inclusion at Jacobs is a way of living and working together. We call it TogetherBeyond, and we take a holistic approach in making employees part of our inclusion journey. It started at the top with the senior leadership team; we then pulled numerous levers to accelerate the transformation, including empowering eight employee network groups, providing training for all employees, and reviewing policies, practices and programs to ensure they supported our culture transformation.
Leading by example
Executive development is a key driver in aligning our cultural aspirations, so we partnered with Duke Corporate Education to develop a culture alignment program around inspiration, inclusion and innovation for vice-presidents and above. We quickly realized that we needed to bring in high potentials too, and we are ultimately expanding the program to include all people leaders.
For Imad Feghali, vice-president and regional director of Middle East operations for people and places solutions, one of the most important take-aways was the idea of the ‘leadership shadow’. “The way it was described and discussed was very important,” he explains. “It’s not what you think people see: it is how people actually see you when you are not around. The program sent a very strong message that we need to be careful and aware of how we behave.
“Over time, we have been able to connect with leaders in a way that feels different to probably any program they previously experienced,” says Almond, who was brought in from the business to help develop the initiative.
Demetriou agrees. “This training is a major factor in driving culture change; the messages that we are sending around inspiration, inclusion and innovation are proving extremely important for overall employee engagement.”
Brand and values
In late 2018, we also embarked on creating a new brand – one that would reflect our culture, engage our employees and resonate with our clients, communities and shareholders. Launched internally and externally in late 2019, our tagline and purpose statement create a ‘north star’ for where we are headed: “Challenging today, reinventing tomorrow, to create a more connected sustainable world.” At the same time, we restated our company values to bring to life our expectations of every employee. They are: we do things right; we challenge the accepted; we aim higher; we live inclusion.
‘We live inclusion’ is defined as putting people at the heart of our business. We have an unparalleled focus on inclusion with a diverse team of visionaries, thinkers and doers. We embrace all perspectives, collaborating to make a positive impact. Restating our values has had a significant impact on how people view inclusion. “We had discussions about it in the past,” says Isaac Henderson, executive advisor for advancing national security. “But now that it is embedded in our values, inclusion has become much more real and tangible.”
“The company values speak to me now more than ever,” adds Sindhu Avalokita, director of finance and project controls. “Regardless of function, market or business group, you can immediately relate to these simple yet powerful values. Recently, in a project-controls meeting with some 60 colleagues, I was able to very easily link the priorities to our values in a way that was relatable to all of us and that each team member could connect with immediately.”
Town halls have been one of several channels used to reinforce these messages. Many companies ‘do a town hall’ once or twice a year. At Jacobs, town hall meetings happen weekly around the world, delivered by the entire senior leadership team. Demetriou uses this forum to communicate what inclusivity means at Jacobs. “It is an opportunity for two-way dialogue as we hear from our people what is on their minds – and then make adjustments,” he says. “One of many examples of impact is how we have amended our parental leave policies in the US, based on employee feedback.”
Jacobs’ aperture of inclusion is broad. It includes diversity in its broadest sense: race, gender, age and tenure, disabilities, veterans, geography, sexual preferences, religion, backgrounds and perspectives. The intent is to create an environment where all employees, join, stay and thrive.
In the past year, Jacobs has continued to push the envelope around three areas: culture-building and engagement, leadership commitment and accountability, and talent development.
1. Culture-building and engagement
Jacobs has eight active employee networks where all employees can find a connection: the Women’s Network; Harambee, a black employee network; Enlace, a Hispanic employee network; VETNET, for active service personnel and veterans from all nations; OneWorld, for global cultures; PRISM, for LGBTI+ employees; Careers, for those early in their career, mid-career and late career; and ACE, for those with physical, mental, cognitive and mobility impairments.
As part of the ‘inside out’ approach to shaping our culture, these networks are empowered to drive actions that will have a positive impact for employees and the company. A simple yet powerful example is Steve Demetriou’s executive sponsorship of the Women’s Network.
“They approached me within a week and said ‘you want to walk the talk? Then change your title from chairman to chair’”, Demetriou explains. “Within a few hours, the title change was done, and I had new business cards printed out. That’s not the end-all, but it does send a powerful message. This isn’t just a lot of talk; everything counts.”
Avalokita agrees: “Members of the c-suite that I have interacted with have been amazing role models. It is not just words. They are actually living and displaying this behavior.”
Imad Feghali is also an executive sponsor of the Women’s Network in the Middle East. Changes have been made in recruiting and HR processes in his region, the UAE, based on input from the Women’s Network. They led to a 27% increase in female recruitment over the past year: women now represent 35% of senior leaders on Feghali’s executive team, up from 10%. “We used to blame low female representation on the country,” he explains. “This is one of many examples of how empowering the networks has generated inclusive behavior.” The talent acquisition team and the Women’s Network were given an award for this initiative in the UAE, and the process is now being rolled out more broadly.
Reflecting Jacobs’ efforts to create unity amongst all employees, the networks collaborate on many projects. Every two years, a joint network summit brings together representatives of all the networks globally, to collaborate on solving business problems, connecting with clients and fostering employee development. Henderson says: “Through the employee networks, I have communicated with colleagues from a variety of disciplines that otherwise I wouldn’t be in touch with. This has led to greater innovation and improved processes.”
Another significant initiative was the internal ‘conscious inclusion’ training, rolled out in 2019 for all employees. Offered both in-person and online, the program helps employees understand their part in creating an inclusive environment. The goal is 100% participation: we are already at 97%, and rising. Our achievements have also been recognized externally. As one example, PRISM celebrated Jacobs taking top honors in the Human Rights Campaign Foundation’s Corporate Equality Index, in both 2019 and 2020, marking Jacobs as a ‘Best Place to Work for LGBTQI+ Equality’.
2. Leadership commitment and accountability
For Jacobs, leadership is the differentiator when it comes to moving the needle on inclusion. Demetriou is one of 60 chief executives who pledged to advance more women into all levels of leadership as part of the Catalyst CEO Champions For Change initiative. Since joining, Jacobs appointed the first female executive vice-president in the company’s history; five of our eight executive leadership team members are now women. We were honored by the 2020 Women on Boards initiative for our commitment that at least 20% of our board of directors will be women. To date, we have achieved executive team diversity of 63% and board diversity of 45%. These results are reflective of specific, actionable work to make changes.
More broadly, each member of our senior leadership team has signed our ‘Inclusion & Diversity Accountability and Commitment Statement’, committing to aim higher, challenge what’s accepted, and hold themselves accountable for creating a company where every employee is empowered to thrive, knowing their individual value is recognized.
To reinforce this commitment, all senior vice-presidents and above have compensation tied to critical culture objectives with a requirement that at least one objective supports inclusion and diversity.
3. Talent development
Jacobs’ recruitment approach leverages our network of employees: 30% of our hires globally come from employee referrals. We are increasing our efforts to attract interns and new college graduates, with a goal to increase the number we hire by 30% in 2020. Once they join Jacobs, we want them to stay, so we have launched E3: a new program designed to ‘engage, excel and elevate’ every employee, driving performance while engaging employees and providing opportunities. We know employees will have five or more careers in their lifetime: there is no reason a person can’t have them all at Jacobs.
Between October 2015 and January 2020, Jacobs has delivered a total shareholder return 165% above the S&P 500, which was up 86% during the same period. To a great extent, our success is the result of our cultural transformation and a growing sense of inclusion in the Jacobs team. For Steve Demetriou, sport – especially basketball – offers valuable lessons for the workplace. “Basketball is a classic team sport,” he says. “It is really the combination of putting complementary talent together. Bringing different skills, capabilities and instincts drives success, versus just having the best players. Business is a combination of clearly having the top talent, and ensuring it is complementary and that the chemistry exists.”
It has been exhilarating to be part of a journey that has led to the creation of such a team.
— Shelie Gustafson is chief human resources officer and a member of the Jacobs executive leadership team