Inspiration session Oct. 5, 2023 with Jan Anne Schelling, former CHRO of Royal IHC

A cat with seven lives—that’s how Jan Anne Schelling describes shipyard Royal IHC. During Highberg’s inspiration session on October 5, the former CHRO shared how he and his team weathered extremely challenging times.

Two rounds of refinancing, a near bankruptcy, and a reorganization that saw nearly half of the employees leave. How do you cope with such a major transition? Jan Anne Schelling, who served as the shipyard’s top HR executive until early this year, is a strong advocate for transparent communication during difficult times. He demonstrated that same openness during the session at the Maliebaan in Utrecht.

When he signed his contract with Royal IHC in the spring of 2018, everything still looked fairly promising. Just five months later, the situation had completely changed. "The company was on the brink of collapse, due to shifting market dynamics and several troubled internal projects. We had to refinance and implement major restructuring."

Schelling was tasked with laying off 1,200 of the 3,500 employees. How did he approach this process? First, he simplified the HR structure and invested in a capable, self-managing, and complementary team. He also fully committed to effective and open communication—something the organization lacked. “Employees could definitely sense things were going badly. So you have to be honest about that. Which was quite difficult, because we couldn’t offer any perspective at the time.” The board initially opposed his idea of giving regular updates to staff—even when there was no news to share. But Schelling persisted. “It was important to establish a rhythm in communication; that brought clarity and calm.”

It was a make-or-break moment for Royal IHC. Major clients like Boskalis and Van Oord stepped in as shareholders at the end of 2019 to rescue the company. Meanwhile, Schelling and his team had quietly mapped out a plan in case of bankruptcy.

In May 2020, interim CEO Gerben Eggink came on board. Schelling shared his ideas with him about reorganizing and changing the organizational structure. Eggink agreed—on one condition: no consultants. “A week later, all the consultants were gone and we had full control.” The company structure was drastically overhauled, shifting from a single hierarchical technical organization to eight product-market groups, each with 100 to 200 people. Seven of the eight groups began performing reasonably well over time; only the large ship production continued to lag behind.

In parallel, Schelling and his team created a social plan within four months for the employees who had to leave. It helped that the union also understood the necessity and urgency. His “finest moment” came when he called his HR colleagues at 11:30 p.m. to say a deal was in place. “I was so excited, I forgot the time. We managed to create a respectful exit for our people, with attention to job-to-job support, and kept expenses under control.”

Schelling wanted to fill new top-level roles through open applications and was given three months to do so. “We set a clear course, outlined all the vacancies, and went full throttle. And we did it.” He was pleased that a few women were appointed to senior roles, even though there were initial grumblings within the organization about one of them having a legal background. HR also made significant strides with performance management and the use of Theory U to encourage employees to reflect on their added value and ambitions.

Several initiatives were discontinued during this time. For example, there were 85 different sustainability projects running. Schelling: “You have to set priorities. If you reduce and redistribute your energy, you perform better. We narrowed them down to thirty and appointed a sustainability manager.”

How did Schelling manage to retain key people during those turbulent times? In part by not only having difficult conversations, but also holding “good news” talks with those who were staying. He believes it’s vital for HR to stay close to the business and speak its language. “You need to know why you need your people.” At Royal IHC, one advantage was that employees were proud of the company and didn’t want to leave of their own accord, he says.

A few months after Schelling left in February this year—he now works at reusable plastic crate producer Schoeller Allibert—good news arrived. Royal IHC secured a major dredger order from Boskalis. Some former employees are even returning, says one of Schelling’s former colleagues present at the inspiration session. “We see how deep the loyalty to the product runs. The maritime world is small and demands the craftsmanship they have to offer.”