Profile: Dean Shoesmith, Sutton and Merton Council
Leadership styles / 01 February 2010
As joint head of human resources at the twin boroughs of Sutton and Merton, Dean Shoesmith is in the vanguard of local authority officials who are driving through radical changes in the public sector. Jane Lewis discovers what motivates this ambitious civil servant
The offices of the London Borough of Sutton are situated opposite a fine old church, on what was once a graveyard. “They say the place is haunted,” says Dean Shoesmith, executive head of human resources at Sutton and Merton borough councils. “Ghostly spectres have been seen flitting around late at night. It’s probably me and the chief executive.”
Shoesmith likes a joke, but the spectral theme seems particularly apposite right now. Rarely has a new decade been greeted with such trepidation by local authorities. They know the axe is headed their way, but not how deep the cuts will be, or how quickly they will come.
Given the scale and complexity of what they have to do, I don’t think senior managers in local government are overpaid. Compared with their private sector counterparts, they receive very modest sums of money.
Dean Shoesmith, executive head of human resources at Sutton and Merton borough councils
“It’s not looking too clever, is it,” says Shoesmith, contemplating the country’s immediate economic prospects.
“There are, to use the cliché, green shoots of recovery in the private sector, but it’s going to get a lot worse in the public sector. The tsunami that hit the banks and then the private sector has progressed up the beach and is just about to hit us.”
The result of the next general election will clearly be significant – the Conservatives have pledged an ‘austerity’ budget within weeks if they take power. But whichever party wins, there will be severe cuts, believes Shoesmith.
“My guess is that whoever’s in political administration, either nationally or locally, will have to deal with that challenge.” Indeed, the Chancellor has pledged to halve the UK’s £178bn budget deficit by 2014 – and most of the cash will come from cuts rather than tax hikes.
“The money’s got to be found somewhere,” says Shoesmith, “and that somewhere is the public sector.” As he points out, some 70-80% of local authority revenue currently comes from central government grants.
The most frequently cited prophet of doom among local government officers is Professor Tony Travers, a public finance specialist at the London School of Economics. Based on Travers’ estimates, local authorities may be looking at a swingeing 30% reduction in funding over five years. “I’ve started to try and project what that means – how it might bite,” says Shoesmith, gesturing towards a whiteboard covered with figures.
As the majority of Liberal Democrat-controlled Sutton’s annual spend is employee-related, he reckons that – in a worst case scenario – the authority might have to reduce its 5,500 headcount by about a quarter. “That is significant by anyone’s reckoning. It means a major, transformational change, and not a nice one to administer.”
Some would say that a headcount reduction on that scale implies there’s plenty of fat to trim. The November 2009 employment figures showed that a record number of Britons are now employed in the public sector, giving critics of ‘big government’ renewed ammunition.
Although Shoesmith prefaces every other remark by stressing the importance of value for money, he says these reductions would mean cutting to the bone. “There will be hard political decisions to make around what we do: what are our priorities, where we might have to deprioritise or decommission, what we might do in different ways.”
As a local government officer he is, of course, resolutely apolitical. “Obviously, I have my own political views, but it’s not appropriate to bring them to work.” Nonetheless, an important skill for senior managers in local government is “to anticipate the needs of any administration. So the lead up to elections is quite important.”
Sometimes the transition from one party to another is relatively seamless; at others, the degree of change can be radical depending on policy and manifesto commitments.
Either way, with local government elections also scheduled for May 2010, it’s going to be an interesting six months for Shoesmith. The challenge of maintaining staff morale in the face of such uncertainty is daunting.
“People are under enormous pressure anyway in my line of work, and it can lead to all sorts of emotional situations – especially if we’re having to make cutbacks. We’ll have to deal with that in as responsible and sympathetic a way as we can.” Shoesmith speaks with experience. “I’ve had to deal with retrenchment and redundancy on many occasions in my career – including my own.”
Sporting dreams
At 16, his greatest ambition was to play for his local football team, Brighton & Hove Albion. But after a business studies degree, followed by a postgraduate diploma in personnel management, he ended up in HR as a graduate trainee at Dalgety Spillers, the Winalot dog food people. Soon after he arrived there, however, the recession of the early 1980s hit with a vengeance: it was a case of last in, first out.
“Being made redundant in my early twenties was a very steep learning curve,” he says, particularly given the personal investment he’d made in his education. Had things turned out differently he might have become head of Winalot. As it was, he eventually took a job with Hammersmith & Fulham Council and became a lifelong public servant.
Shoesmith’s personal history will certainly inform the way he manages any future retrenchment. But Sutton is perhaps better placed than many local authorities: it has a solid record of driving through sweeping change successfully – with Shoesmith in the vanguard.
In September 2008, the council embarked on a “pioneering experiment” to pool its HR department with that of neighbours Merton, a model of “shared services” that might well become a blueprint for other departments – and councils.
Shoesmith credits the idea as the brainchild of the chief executives of the two boroughs. “The senior HR position at Merton became vacant. They could have gone out into the open market to fill the post, but the chief executive had the vision and confidence to try something different. He had a conversation with our chief executive and this is where it took us.”
The weight of assessing the feasibility of the transition and making it work in practice fell squarely on Shoesmith’s shoulders.
It wasn’t always easy. Although there were no redundancies as a result of the merger, which has seen Merton staff TUPE-transferred (with protected terms and conditions of employment) to Sutton, he was initially viewed with suspicion at Merton.
“It’s a different organisation with its own culture and customer-base, and you’ve got to be quite agile to work across two different organisations.” In the early days, he attended two sets of meetings, dealt with two lots of post and waded his way through messages in two separate email accounts. He still spends a lot of time in the car shuttling between the councils. “You don’t just get the car into gear, you have to get your head into gear going from one to the other.”
He’s been fortunate, he says, in having the support of excellent people in both offices. “We’ve all worked very hard to establish an effective working relationship, which is clearly crucial if the shared service model is to work.”
The result has been considerable savings, estimated at up to £500,000 for both authorities. Another plus was securing the services of such a seasoned HR honcho at a greatly reduced price. It’s like doing two jobs, “but regrettably I don’t get paid two heads of HR salaries,” says Shoesmith with a smile.
One of the most divisive effects of the economic downturn has been an increasingly heated debate about senior public servants’ pay.
Do council chiefs really deserve to take home more than the Prime Minister? And why should they enjoy gold-plated final salary pensions, partially funded by taxpayers in the private sector whose own retirement funds have been decimated? Some commentators have been ratcheting up the rhetoric by referring to the UK’s growing problem of ‘pensions apartheid’.
The pensions issue could well become a flashpoint and may be due a review, says Shoesmith, though that could have worrying repercussions for the sector’s attractiveness in terms of recruitment and retention. But he’s got no time for claims that local authority executives are on some kind of gravy train. “Given the scale and complexity of what they have to do, I don’t think senior managers in local government are overpaid. Compared with their private sector counterparts, they receive very modest sums of money.
“Certainly, in my professional area, HR, the work is harder in the public sector because it’s so complex. Having worked in the private sector, I know that if you want to do something, there are actually very few people you need to consult: you just get on with it and that’s fine.
“We’re dealing with multiple stakeholders: residents, trade unions, politicians, local lobbying groups and employees with often very complex conditions of employment. We’re not running a single entity but a very complex set of mini businesses. Every local authority runs upwards of 500-600 different services and our duty is to deliver the very best service we can at the lowest level of costs to our council taxpayers. It’s tough.”
So is the ability to deal with complexity the most important quality needed in public sector management? It’s certainly a word that Shoesmith returns to. “Call me Mr Complex,” he says. “Managing complexity is certainly a crucial skill. But so too is handling uncertainty and ambiguity.” Communication skills are critical in any job, he adds, but they’re particularly important in the public sector because managers are so often working under the spotlight of public scrutiny.
Council officers also have a social duty to the borough’s residents which, for all the talk of corporate social responsibility (CSR), is much less pronounced in the private sector. The big debate dominating national politics – weighing up the immediate cost savings of redundancies versus the long-term pain and costs of unemployment – is being played out on a micro scale in Sutton and Merton. “It’s a real conundrum. If you cut back on employment costs, you pay out more in benefits. And what really concerns me, given the spiralling level of youth unemployment, is that it can lead to deep societal tensions.
“There’s a demographic time bomb to consider too. By the mid 2020s, we project that 20% of the Sutton workforce could retire, which would mean a huge amount of knowledge going out of the organisation.”
Ultimately, he hopes to turn “adversity to advantage”. If cuts have to happen, he plans to seize the chance of “remodelling the way we work” – to re-engineer existing roles at the council “to create more entry-level positions for young people”.
Entrepreneurial spirit
But it is clear that local authorities can still learn from the private sector. “We don’t run businesses, we run services. But some of the methodology from the private sector has been helpful.”
The shared services approach being pioneered at Sutton and Merton is a case in point. So too was Compulsory Competitive Tendering (CCT), which the Conservatives introduced in the 1980s, and has continued under New Labour as Best Value Tendering. “Acting in an innovative, possibly entrepreneurial, way to get best value for the council taxpayer is clearly more sensible than running a monopolistic, monolithic organisation, which never scrutinises itself. Pre-CTT that was probably the position for many local authorities.”
Shoesmith, who wrote a dissertation on emotional intelligence for his Masters degree and cites the American psychologist and leadership specialist Daniel Goleman as a particular influence, is at the forefront of management thinking in local government. This year he becomes president of the Public Sector People Managers Association (PPMA) – a useful forum for networking with his peers. A firm believer in flexible, situational leadership, Shoesmith believes – as does Goleman – that self-awareness is the key to good management, and has undergone virtually every personality and competence test going.
With a nice line in self-deprecatory humour, Shoesmith is the epitomy of calm. “When people ask what I do and I tell them I work in a local authority, they’re half asleep. By the time I’ve said I’m a human resources officer, they’re usually completely comatose.”
But his passion for the fast and furious sport of ice hockey hints at traits of ambition and dynamism beneath the calm exterior. Underestimate him at your peril.
As far as local government is concerned, it may well be a case of cometh the hour, cometh the man.