National Grid

BACKGROUND

National Grid is the sole owner and operator of the electricity transmission system in England and Wales. It transmits electricity through about 4,500 miles of overhead and underground lines to distribution utilities serving more than 52 million people. National Grid also operates the United Kingdom’s natural gas transmission and distribution system (serving more than 11 million homes and businesses) through its National Grid Gas subsidiary. The company also operates gas distribution and power generation, transmission, and distribution in the U.S.A. In FY2009, the company generated US$7 billion in revenues and employed 27,000 staff.

SITUATION

As with most regulated utilities, National Grid is facing significant changes to its operating landscape while managing a rapidly-changing human capital asset base:

1. Operating landscape

Electricity transmission is a growth business; new investments (to support the 2012 London Olympics and new rail system, etc) will significantly increase capacity & demand
Renewable energy programs (targets for wind/nuclear power, “grow your own” electricity schemes) require a mindset shift in how National Grid delivers energy to consumers
For older transmission infrastructures, asset replacement vs. maintenance decisions will dramatically impact future capital expenditures

2. Human capital drivers

Prospect of significant retirements (several job roles have more than 40 percent of staff at risk of retirement by 2020)
Rising demand for new hires (particularly in the Project, Field, and Asset Engineer roles) to support the growth business, requiring more resources devoted to job development, mentoring, and learning activities
Decreasing supply of Power Engineers, affecting the core business; external research studies indicate falling graduation rates for Engineers by 2011
Long cycle time to productivity; acquiring National Grid-specific expertise can take 5 years
Increasing labor market competition for staff with specialized skills in new assets and technologies, and those with extensive experience, requires greater retention planning

ACTION

From September 2008 to May 2009, National Grid partnered with Inform to conduct a pilot workforce planning program for critical jobs within the Transmission Group, which employs 980 staff. Run as a partnership between Transmission business leaders and global HR, the pilot had six key objectives:

1. Understand the current people implications (staffing, talent management, learning & development) of Transmission’s business requirements for two scenarios (Business as Usual/Little Change and Plausible But High Level Change)

2. Identify gaps in skills and talent that could hinder execution of the group’s business strategy

3. Create an action plan to cost-effectively address identified gaps

4. Test a workforce planning methodology prior to enterprise roll-out

5. Develop staff skills in workforce planning techniques

6. Embed learning from workforce planning pilot into the business planning process

RESULTS

The first workforce planning pilot was completed in late 2009, with the results presented to National Grid’s Chief Executive Officer and the Global Heads of Transmission and Gas. With support of the organization’s senior leaders, National Grid will expand workforce planning to cover employees in both the U.K. and U.S.

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