ST LUKES COMMUNICATIONS

St Lukes is an employee-owned company operating within the communications/advertising sector. St Lukes was founded in 1995 and claims to be the world's first ethical, stakeholding advertising agency. It defines itself as a stakeholder organisation and was founded on the belief that work should be fun, fulfilling and fair.

Partnership Philosophy

St Lukes tends to use the word stakeholder to describe the relationship between the organisation and the employees. Partnership is the word used to define client relationships. Every employee is a shareholder in the company. New employees are entitled to become shareholders after a probationary period. The number of shares held by an employee is related to their length of service, with shares reallocated at the end of every year. The principle underpinning the stakeholding system is that "Your salary is paid for your day job. Your shares are not free; they pay for your responsibility as a stakeholder."

Partnership Practices

Flexible working and appraisal

There are no job descriptions within St Lukes, and everyone is encouraged to work outside their remit. Starting and finishing times are left up to the individual employee. Employees work in project teams which are very much self-managed although there is also a line manager for the purpose of appraisal and day to day resource decisions. There is a review system of everyone's performance. This is a forward-looking exercise at which an employee's development is discussed and planned and performance targets are agreed. A template is used and the parties are encouraged to use it flexibly.

Personal Development

Personal development is discretionary in that employees can define their own learning needs and targets with the proviso that staff share their knowledge with colleagues. St Lukes also runs a 'make yourself more interesting' campaign which helps finance employees to take courses that are unrelated to work. Every five years employees are entitled to a four-week sabbatical which they can take for whatever purpose they wish.

Interactive work spaces

There are no offices or dedicated meeting rooms in St Lukes. Instead there are Brand Rooms which are devoted to and used by clients. They are decorated and fitted out to the client's taste. The Clark's room for example is like a shoe shop. The room can also reflect the product that the Brand Room exists to promote; the Boots No 17 room is furnished like a teenager's bedroom. No employee has their own desk. Employees work anywhere they find it convenient to do so as there are PCs available throughout the building, including the restaurant. There are no fixed telephones as everyone has a mobile phone which works both inside and outside the building. Employees can chose to work at home if they wish to and the company has the internet and IT facilities to allow anyone to do so effectively.

Communications

St Lukes attempts to communicate openly, transparently and directly. Staff are fully informed on all matters relating directly to the business, including such issues as major capital investment, new products, new services, and the introduction of new technology. There are two vital meeting streams, in which key information is communicated. Every Monday everyone in the company gets together to discuss pressing issues. There are also daily account meetings at which staff participate. Secondly, once every month there is a creative review called the Flag Meeting at which everyone is brought together to talk about their work. This is a structured meeting at which people have to make presentations and talk about, for example, their five favourite things. "These meetings give people a feeling of empowerment; there is the opportunity to say what you want, and, if you argue articulately, to get it."

Employee Representation

QUEST is the legal body which issues the shares in the company. It is also the governing body of the Agency. There are six members of QUEST elected annually by the staff and they also have a remit to move the Agency forward.

Employment security

St Lukes is committed to offering employment security, buttressed of course by the employee ownership of the business. The advertising industry as a whole is currently forecasting a recession and the laying-off of staff. St Lukes, however, prefer to take any other strategy rather than lay people off, by considering other possible options e.g. staff undergoing a pay-cut.

Pay and conditions

All terms and conditions are harmonised. Every year employees choose two other employees to review their wages. A very responsible reward culture operates within St Lukes. At St Lukes an employee said "you and your performance are exposed; there is a lot of self-selection."

Outcomes and the Future

The Agency's financial success is testimony to the efficacy of its organisational design. The value of its billed work in 1998 was £85 million. St Lukes achieved Agency of the Year award for 1997. The company works as a 'conviction company' in so far as St Lukes has turned down the chance to obtain potentially lucrative contracts on ethical grounds. In broader employee relations terms the level of labour turnover within St Lukes is phenomenally low. Since the company's inception, only one person has left to join another company. This is entirely against the norm in an industry characterised by very high levels of labour mobility, and moreover, labour absenteeism is negligible within the company.

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Last revised: 20 March, 2001