Is Taking a Pulse Too Invasive?

Corporate culture is a tricky thing. It develops over time, but we want to change it quickly when it suits us. The business media is replete with examples of great (100 best places to work!) and toxic (see Uber, supposedly) places to work. If your job is to influence those cultures, where do you start?

I am very big on measurement in the workplace. Whether it is testing for job candidates, evaluating job performance, or surveying employee engagement. So, I was interested to read about startup software tools that provide for spot surveys and compliance measures. The appeal of these is clear. Real time data can lead to real time solutions. But, are these really ways to improve culture or just faster methods of applying band-aids?

Culture evolves whether you want it to or not. Companies that actively manage employee engagement can use it as a strategic and recruiting advantage. The constant use of software to measure culture strikes me as a reactive approach. It can lead companies to chase small problems (“Why has turnover ticked up in Pat’s area?”) instead of focusing on larger ones (“What are we doing to ensure that all of our best employees want to stay?”). Also by constantly measuring engagement we are affecting it, but probably not in the way we want to be (“Why are we constantly being asked for our opinion? Doesn’t management know what’s happening here?”).

I would suggest a thoughtful approach where you ask what you want your culture to be. You can take a baseline measure and then take steps to close any gaps (hint—be sure that senior executives are modeling and talking about the culture you are trying to achieve). Then see if closing any of those gaps affects measures of engagement (turnover, absenteeism, productivity, etc). Keep focusing on what has impact and put aside what doesn’t. Wash, rinse, repeat. This replaces a “whack-a-mole” approach with a more strategic one that does not require constant surveying.

Senior executives should have a “pulse” on the organization, but they should not have to be constantly asking “are we there yet?” like an 8 year old in the back of a car. If you approach employee engagement strategically, you can manage better and not be so invasive.

Another Step Towards Engaging Millennials

When writing previously about employee engagement, I discussed how companies can encourage employees to be engaged by taking steps to connect them with the organization.  We also know that, as a group, millennials tend to look for ways to connect with their employers and co-workers in ways that go beyond whatever product or service they are delivering at work.

This article describes a start-up that provides experiences for groups of employees to help encourage engagement in a way that is enticing to millennials.  This includes unique experiences they can together and being involved in community service.

Of course, this type of thing is not brand new.  Companies have been involved with stalwart social service organizations like United Way and Red Cross for many years.  But, I think it is fair to say that millennials are looking for something a bit more active than fundraising and giving blood (both worthy endeavors, by the way).

Companies do not need to outsource their engagement activities and management can brainstorm things that would appeal to their employees and fit with their culture.  But, this does show how companies are trying to get younger workers more engaged by experiencing intrinsic rewards (feelings of accomplishment) rather than extrinsic ones (here is a thing for doing well).  It also underlines how it is important to proactively create engagement you want to improve teamwork and reduce turnover.

He Knows When You Are Working, He Knows When Are Logged Out

As long as there have been workers, management has looked for ways to manage performance.  In the case of piece work, it was mostly used to provide incentives for productivity.  As the economy became more service oriented, performance was also measured so that throughput could be forecasted more accurately (think about a telephone center predicting the number of call to be handled on a certain day).

The use of this data has traditionally been used to “gamify” work as well.  That is, make reaching certain performance level an incentive in and of itself.  Sales competitions are a great example of this.  The logic being that if something is like playing a game it will be more fun (read: motivating) than something that seems like work.

Big data gives companies more ammunition to gamify work.  It also provides opportunities for the application of it to go beyond making or selling widgets.  As this article points out, Uber is at the forefront of this (though, make no mistake, they are not the only ones doing it).

Uber really has a love/hate relationship with its drivers.  Right now it needs them, but they foresee a day where they will need fewer people behind the wheel due to the automation of cars.  Uber needs a lot of drivers to provide high levels of service, but a glut of them leads to fewer occurrences of surge pricing (Uber’s version of raising prices and being more profitable when demand is high compared to the supply of drivers), which leads to fewer people being available since they will not make as much money.

Forecasting labor availability is key for the company in order to maintain service levels.  But, since Uber insists that the drivers are independent contractors who can work whenever they want, they cannot schedule the appropriate number of drivers to match anticipated demand.  So, to keep drivers logged in the app and behind the wheel, they have employed the same techniques that video game designers use to keep people playing.

In the article, the author clearly thinks that tapping into these motivations is “tricking” drivers into spending more time behind the wheel than they may want to.  But, is this really any different than traditional motivation techniques used by leaders such as providing intrinsic motivators like praise (“I appreciate the hard work you put into that presentation”) to reward and encourage future efforts?  Is it more coercive than, “You need to work at the store on Thanksgiving or your fired.”?

The answers really depend on whether the goals that Uber wants to achieve are aligned with those of the drivers.  If keeping more people in the app leads to more idle time (time spent without making any money), then I have a real problem with it.  If it helps manage the drivers’ time in a way that allows them to be more efficient and them and Uber to be more profitable, then I am good with it.

Worker performance has always been managed to help achieve organizational goals.  New technologies allow companies to look at these issues more closely than ever before.  HR should examine closely whether these efforts enhance engagement and, in the case of independent contractors, financial viability.

Lost Communication and the Death of Process

The business world is both transient and stable.  People and priorities change, but as long as the organization is in existence it has processes that continue on.  When the information gets disseminated is becomes institutional knowledge.  We often connect this with an individual (When Maria leaves we are in trouble because she has so much institutional knowledge.), but keeping this information available improves the understanding of processes throughout the enterprise.
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But, how we speak about things changes over time.  For instance, organizational commitment became employee satisfaction, which became employee engagement.  There are subtle differences between them, but what we have always been talking about is, “How much do people want to be here and contribute?”  Yet, if we did not have records about how we understood these concepts we would have some difficulty understanding how and why we conduct (or don’t conduct) employee surveys.

The challenge is how to keep track of the amount of information that organizations generate and keep it in an update language that makes sense as the business changes.  For instance, in my practice it is normally takes quite a bit of communication and presentations to keep validated testing programs going when there is a change in HR leadership.

Perhaps a more interesting example is outlined in this article, which describes how a group of volunteers are taking handwritten letters to reconstruct the English language during Shakespeare’s time.  You may say that 400 years is much longer than any business organization has been around, but think about the rapid changes in computer languages and how important understanding the “old” ones are in maintaining or updating systems.  The archaic can be useful

What potentially gets lost over time and change in language are the research and reasons for doing things.  We lose the ability to answer the most basic of business questions, “Why are we doing this?  Why are we doing it this way?”  Being able to communicate the answers those questions allows for adapting processes when the environment changes and prevents reinventing the wheel.

 

 

How Far Will You Go to Emphasize a Culture of Customer Service?

I am a regular listener to the podcast of This American Life.  Recently, they had a segment on customer satisfaction and L.L. Bean’s extreme version interpreting it (“Our products are guaranteed to give 100% satisfaction in every way. Return anything purchased from us at any time if it proves otherwise. We do not want you to have anything from L.L.Bean that is not completely satisfactory.”).  You can read the transcript here (go down to “Act Two. Bean Counter”) or download to podcast (I recommend the latter).  Some of the stories are stunning.

The first issue is who gets to define customer satisfaction?  The company?  The customer?  Of course, only the customer knows if s/he is truly satisfied with a product or service and the satisfaction is generally derived from whether or not they got exactly what they wanted out of the transaction. So, the question really is what will a company do when the customer is not satisfied?

In non-competitive marketplaces (think government services or other monopolies), don’t hold your breath.  To them, customer satisfaction is a cost, not an investment.  There is no incentive for them to make you happy (though, one could argue that working in a customer service oriented environment would lead to a better culture, which leads to better word of mouth when it comes to recruiting).   Lucky Patcher app The same goes for pseudo-competitive marketplaces (like cable/satellite TV) where you have some limited choices but making a switch is really a pain in the ass.

However, in competitive marketplaces, like apparel, delivering superior customer service is a differentiator.  All of us can think of how different retailers interpret customer satisfaction and the investment they put into it.

What I found most interesting during the podcast was the training that went into ensuring that LL Bean’s return policy was carried out.  It’s one thing to say, “OK, we’ll take back anything that you bring back for store credit” and another to do it in a way that provides for a satisfying experience for the customer.  Note that they trained people who work in returns to execute the letter and the spirit of the policy.  LL Bean also selects people who work in that department who have the personality and skills to carry it out.

What this tells us is that customer service does not just happen.  Rather, it is a combination of strategy, culture, and the right people to treat customers the way the company wants to treat them.  What is your plan to align all of these?

Really, Autonomy is NOT Overrated

To use a tired cliché, they call it Show Business for a reason. Fortunately, within the last 10 years or so, the news media in Los Angeles has been covering that industry as it would any other large one in the region. So, it made a local splash when the Chairman and CEO of CBS said at a conference when discussing the artistic freedom that streaming services and others give filmmakers, “Autonomy is overrated” and “I helped cast ‘Friends.’ I was an executive… We help the process at the studio, at the network.”

I think there are better ways to support your argument than a one-off example from 20+ years ago. Also, Mlodinow’s book The Drunkard’s Walk cites some pretty good examples how much randomness goes into the success of entertainment ventures, so for each positive example he provided for casting I’m sure there is another one where his control over the decision making process hurt the project. Or, maybe the show would have been just as successful with the original casting. But, I digress.

Autonomy is freedom from external control or influence. It does not mean doing something without input or ideas from others. It is a state of independence in that you have the final say on decisions. Perhaps from an executive’s point of view that’s dangerous or nerve wracking, but for employees it is anything but overrated. The data show that perceived autonomy is related to many important organizational outcomes, including productivity and job satisfaction.

What he was really talking about was his company’s willingness to invest $X million of dollars into anything without having some veto rights in terms of content, casting, etc. In this case, it’s buying content and the struggle is over who really owns it. In a more typical scenario, it’s hiring people to execute a business plan and the struggle is over how much control the managers feel they needs to have over employees.

This week I’m working with a retail client in building competency models. They have recently moved to a business model where customer engagement is more important than it had been in the past. One example that middle managers gave of this was getting rid of a multi-tiered refund policy (this happens if you have a receipt, this happens if it’s after 30 days, etc.) and giving the store managers the decision making authority to say “Yes” to pretty much any reasonable refund request. I’m guessing that customers don’t think that this autonomy is overrated.

Autonomy is also a key part of the “gig” economy. While there are important legal issues as to whether these people are employees in certain situations, the larger issue is that there’s a strong need for them to feel that they are controlling their own destiny. A few months ago I got a ride from a woman who was living the gig economy dream. She had a “regular” part-time job where she had control of her hours. She drove for two ride sharing services and rented out a room in her house. When I asked her if that was a lot to keep track of, she responded that she was a good time manager (obviously) and that the freedom to work (or not work) any specific set of hours was important to her.

My observation is that millennials enjoy the autonomy that technology gives them. This leads to an expectation of it in the workplace. Employers should use this as an opportunity to create engagement.

Giving people (appropriate) decision making authority should not be scary if they are properly hired and trained. Executives who fear autonomy are missing out on engaged and high performing employees.

Are Employee Owners More Engaged?

Among the incentives employers provide are stock incentive programs.  The thinking is simple—if someone is an owner of a company (no matter how small) they’ll act in a way that is more beneficial to the enterprise.  With startups, it’s a bit of a gamble (take less cash up front, but if this thing takes off you’ll be rich) and with more established ones it probably helps stabilize the stock price.  But does this incentive lead to better organizational outcomes?
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Most of the available data says yes in the sense that companies that offer these types of programs out perform those that don’t.  However, correlation is not causation.  It is probably only companies that are already doing well that make this type of incentive available.  Also, in high tech and bio tech they have come to be expected, so they probably don’t work as motivators.

What is interesting, and probably effective, is the psychological aspect of begin an owner.  Except in small companies, an employee is rarely going to see the direct affects of his efforts on the bottom line.  But, having an ownership position, no matter how small, does invite more engagement.  A perfect example is with the Green Bay Packers football team.  The team offers stock to its fans, but it’s essentially worthless.  But, when it’s offered it sells so that fans feel that they have ownership in the team.

The idea of “owning” one’s work or destiny is a powerful one.  In change management we often speak of authoring or owning change.  Having ownership feeds into our need for autonomy, or control over our destiny.  Whether it is through owning stock or having meaningful input into work product, we want to be able to say, “I did this so I could impact an outcome.”  And that is important, regardless of whether the outcome is a stock price or how the widgets get engineered.

This is a powerful incentive to be used by management, but it involves each level giving up a bit of its own ownership position.  But, some executives, such as at Chobani think it is worth it.

Filling Diversity Buckets

With great fanfare, Intel announced recently that it is making progress in meeting its diversity goals. I’m not going to pick on their numbers as their current demographics are what they are. There are some good lessons we can learn from how they approached the issue.

  • You have to be holistic. They understand that culture, recruitment, and retention all play a part in attracting, hiring, and keeping diverse talent.
  • Drill down in the data. Intel looks at hiring and retention in different job categories. Saying that you are diverse overall, but not in high paying jobs, is not much of a victory.
  • It takes significant resources to make changes. Developing a pipeline of diverse talent requires money in scholarships, helping schools, etc and finding untapped recruitment pools take time and money.
  • Just like any other business outcome, the goals are reached only if they are measured AND if there are rewards for doing so. Sorry, but you cannot assume that people will strive for noble goals out of the goodness of their hearts.
  • It’s more than hiring numbers. You need to get the compensation and culture right to retain people. Oh, and selecting and developing good managers, as that has a huge influence on turnover.

This article goes into a bit more depth about the challenges Intel are facing. Not surprisingly, there are concerns about balancing multiculturalism (celebrating differences) and integration (making one big happy family). It also points out that if people are spending time on diversity programs, it takes them away from their “real” job (unless they are in the diversity department) and makes it tougher to get promoted and make the higher ranks more diverse.

Just as importantly, this is a case study about what doesn’t work. There is a lot of good science about unconscious bias. However, Intel found that training people about it doesn’t really affect their decisions, or at least as much as tying their compensation to it does.

You can see how Intel treated this as a supply chain as a human resources issue. It’s an interesting approach that probably led to some creative ideas. You’ll note that there is no discussion about lowering standards, which is divisive and bad for the businesses. It is also something that probably is not discussed when they are sourcing equipment. Just something to keep in mind when making important business decisions.

At Least All Employees Get Treated Poorly

For the life of me, I cannot understand why some companies go out of their way to treat their employees poorly. It starts innocuously, like putting employees last in a mission statement. Then it morphs into thinking that people are really machinery (scientific management to the extreme) or a cost center rather than the deliverers of service and product excellence.

Our first example comes from companies that hire low-wage earners. Employers cutting peoples’ hours to avoid paying for benefits is nothing new, but the Affordable Care Act gives them another excuse to do this. And guess what? Many regret it because of the unintended, but obvious, consequences. You cannot say that you want to deliver great value to your customers while at the same time giving your employees lots of reasons to be unengaged. How can you expect people to show up on time and work hard when you keep their hours low (at a poorly paid job) to avoid paying for health insurance (or some other benefit)?

But, it is not just those at the bottom of the economic ladder that get poor treatment. Yahoo, which is getting its clock cleaned by its competitors, implemented a quarterly ranking system of all managers. You may be saying, “But, isn’t frequent performance management a good thing?” Well, yes, it is. But, Yahoo implemented a forced-ranking system on a 1-5 scale.

The forced ranking system where managers have to place people into “buckets”: 10% in “greatly exceeds,” 25% in “exceeds,” 50% in “achieves,” 10% in “occasionally misses,” and 5% in “misses.” To their credit, it’s not quite a bell curve, but the focus is clearly on the distribution of performance and not the performance itself. I consulted for a company that used a similar system and it made almost everyone miserable. You know who hated it the most? Those in the “exceeds” category, because they all thought they were in “greatly exceeds” and resented not getting the benefits (additional training, etc) that went with it. Those in the lowest bucket pretty much knew they were already there.

There’s a long list of companies that have abandoned this type of ranking system (Microsoft being one), yet this type of flogging continues to exist. I get the theory: We need to identify and fire poor performers as they are a drag on our business and we need to identify or best talent and develop them. But why the ham-fisted approach? Good performance management is about defining performance goals with the employees and measuring job output against those standards. Everyone can succeed or everyone can fail, but at least people are judged against their performance and rather than an arbitrary distribution.

Companies have to compete for top talent and a great culture is a great way to attract and retain productive people. Employees want to work in a place where they are engaged. Yahoo is saying, “Come here and be innovative while we constantly compare your performance against others in different jobs.” Not exactly a great pitch. Some restaurants are saying, “We don’t value you enough to pay a competitive wage (unless forced to by law) and we’ll cut your hours to save some additional money. But, please work hard and please our customers while you are here.” Not exactly a great way to deliver great service and keep turnover down.

Whether an HR employee or a consultant, our role is to show leaders the value of employees and the value they bring to a company. We should be fighting efforts that treat people like a cost.

For more information on effective performance management, contact Warren Bobrow.

 

 

What Millennials Want. JK

Every generation gets over researched, and Millennials are no exception. I say over researched because it’s easy to stereotype younger workers based on this data. It’s almost like sewing on their Myers-Briggs type. Generations of workers are shaped by the culture of work, and vice versa, so it can be interesting to look at some of the data.

We cannot start and manage companies in the “gig” economy while simultaneously complaining that millenials don’t want to stay at the same job for a long time. Just like we should not criticize people for job hopping during boom-and-bust cycles in the tech sector. A more stable employment environment leads to more stable workers (see post war America).

So, among the many things employers can do to reduce turnover is create an engaging work culture and one that shows that you care. Think of it like products you purchase that don’t compete on price, but do so based on quality and value.

This article talks about what some small businesses are doing to reduce their turnover among younger workers. Many of you may be thinking that these ideas don’t apply to your bigger company, but they really do. If your managers have an “ownership” mentality,    Download BlueStacks App Player for PC and the company has policies that support it, they can implement many of these programs.

One of the intriguing approaches was looking for workers from non-traditional career paths. When I’m asked to validate tests, I’ll often use biographical history items (asking about experiences). Clients always think that experience in similar fields is important for candidates to have in order for them to successful in the new company, but it is rarely the case. As this example shows, skill, ability, and drive are much more important than traveling the “right” path.

Whatever your approach to lowering turnover, remember the best takeaway from the article is, “For any incentives to work over the long term, employees must be invested in a company and its mission.” And that means a company must be invested in the career plans of the millennial employee.

For more information about creating a more engaging work environment, please contact Warren Bobrow.

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