Employee to Manager: A Smooth Transition

HR That Works President, Don Phin, will share with you how to smoothly make the transition from employee to manager in this quick 5-minute video. HR That Works Members should also view the recording of the August 22nd webinar entitled First Time Managers and Supervisors.

10 Great HR Ideas

1. Find out your numbers – Use the HR That Works Cost Calculator and get to the bottom line of your HR practices.
2. Create a rolling 90-day game plan – You must plan to succeed and without a plan, you plan to fail. Focus on one strategic objective per month and update your 90-day game plan every 30 days. Make sure the leadership team knows what you’re up to.
3. Reinvent performance management – First of all, realize that most managers and employees will be glad that you finally ditched the old system. Then, watch the Performance Management Training and the ROWE (Results Only Work Environment) recorded webinar and then conduct a workshop to see how you can generate a performance management system that works organically for your company.
4. Introduce the Creativity Checklist and Employee Suggestion Form and require that people use it  The ideas you generate should help pay for the HR That Works program for many years to come.
5. Create a social media policy that works – Involve the head of IT, marketing, and a group of employees to fashion an approach that works for all parties.
6. Use the HR That Works Compliance Survey every six months – Doing so will ride you of unwanted claims in the process.
7. Conduct an HR survey of your management team – The HR That Works Management Survey will let you know how the management team views the strength of your contributions and where they need more help from you.
8. Bring your employee handbook to life – Fact is, most employee handbooks are boring at best. On the Employee Handbook page is the contact information for our graphics expert, Summer Bonne, who will help you getting your handbook act looking right.
9. Ask yourself this when you hire: Am I more interested in creating the future or preserving the past?
10. Have some fun! Be creative! Get out of the box! HR has a real opportunity to generate some positive dramas at your company- and we all know we need those!

First Graduates with HRTW Black Belt Certification

Congratulations goes out to four outstanding women who completed the year-long HR That Works Black Belt training program!

From left to right Leslie Thomas, Lisa Hecker, Tootie Norton, and Brenda Boyer.

Ethical Dilemmas

According to the Ethics Resource Center: 45% of employees say they witness ethical misconduct at work in 2011. Out of those employees, 65% reported the misconduct to management.  34% of employees said their managers behaved unethically.

Employees witness the following behaviors at work:

• Misuse of company time 33%
• Discrimination 15%
• Health/safety violations 13%
• Lying to outside shareholders 12%
• Stealing 12%
• Falsifying timecards 11%
• Sexual harassment 11%
• Accepting or offering kickbacks/bribes 5%

Talk about employment risks—here they are. The worst being robbing companies of an honest day’s work! To read more information about the survey go to http://www.ethics.org/nbes/

Trokey’s Take: Why don’t they want or use my solutions?

By Kevin Trokey

I hear various broker conversations that include a similar complaint: prospects don’t seem to truly appreciate the value of the value-added services being offered. And, even when they do, they don’t use them after they become a client. There are many reasons for this, but I’m going to focus on a few within your control.

I’m assuming many of the value-added solutions you offer prospects are intended to help improve internal communications: You set up websites, deliver valuable content, discuss year-round communication strategy, provide communication resources to improve performance management and maybe you even suggest ways to improve communication with their clients.

I’m also assuming you can empathize with these conversations, and you have prospects to whom you present your solutions—prospects who would clearly benefit from having them, but never hire you to get the job done. I’m just as certain that some of your prospects-turned-clients never use the solution as either of you intended. That lack of use almost always happens for two reasons:

1. Lack of motivation by the client or prospect to do the hard work of implementing the new solution, process or procedure that you are offering.  This is largely because you lead with a solution rather than with a conversation as to why the prospect may need the solution.
2. We, as brokers, leave them only to consider the price of our solution—or worse, leave them thinking it is “free” and, by reasoning, has no inherent value—rather than putting them in position to weigh that price against the cost of their current action (or inaction, as it were).

Leading with a client-focused conversation is a topic for another article; for now, we’ll examine some ways to quantify the high “cost of doing nothing.”

Determining the cost of doing nothing for corporate communications
To illustrate, let’s evaluate the costs for hypothetical ABC Co., based on the following information. If your prospect can identify this information for their own company, you can help them quantify their financial impact of poor communication:

• 50 employees
• Average salary = $41,674 (avg. annual U.S. wage according to ssa.gov)
• Revenue/ee = $100,000 (avg. revenue for small business)
• Profit margin = 10% (according to smallbiztrends.com)

We’re going to evaluate the organizational impact of poor communication in the following four key areas:

1. Organizational vision
Employers need to be communicating to their employees about where they are now as a company, where they are going, the steps they need to take to move from the former to the latter, and how they are performing as an organization at any point in time.  Those who don’t are disconnecting themselves from their employees and exposing themselves to the high cost of employee disengagement.

According to a recent Gallup study, the cost of disengagement is represented by the term “payroll efficiency factor.” In an average company, this runs 63% (leaving an inefficiency factor of 37%). That means for every $100,000 spent on payroll, there is only $63,000 worth of work being performed. Let’s calculate for ABC Co.:

• Annual Payroll = $2,083,700 (average salary x number of employees)
• Engagement inefficiencies = $770,969 (Payroll x inefficiency factor)
• Let’s assume that only 1/3 of that inefficiency could be attributed to this area, we still have a negative financial impact of $256,989

2. Individual performance
Let’s be honest, almost nobody enjoys performance reviews—mostly because few managers have been properly trained on how to do them effectively. Many elements contribute to effective performance management, but ongoing communication between managers and direct reports is key.

A study by the Hacket Group cites companies who excel in this area show a 22% improvement in net profit margin. For ABC Co., that translates to:

• Annual Revenue = $500,000 ($100,000 rev/ee x 50 ees)
• Profit Margin = 10%
• Net Profit = $500,000
• Increased profit due to improved communication in this area = $110,000 ($500,000 x 22%)

3. Customer communication
We talk often about the importance of employee engagement, but almost as important is customer engagement. The key to customer engagement is twofold. First, engaged employees will result in engaged customers. Second, we have to ensure that we are communicating the right message in the right way to customers.  When we do so (according to Harvard Business Review), the results are also twofold: engaged customers will spend 23% more with us, and the dollars that they spend will also be 23% more profitable.

Again, let’s see what that translates to for ABC Co.

• Current annual revenue = $5,000,000
• Engaged annual revenue = $6,150,000 ($5,000,000 x 23% increase)
• Engaged profit margin = 12.3% (10% x 23% increase)
• Engaged net profit = $756,450 ($6,150,000 x 12.3%)
• Improvement in net profit = $256,450 ($756,450 – previous profit of $500,000)

4. Benefit program
We all know that employers want their employees to place the highest value possible on the benefits provided, and effectively communicating that is the key to maximizing that value. What we may not all know is the quantified cost of that value: According to the McKinsey Quarterly study, effectively communicating a benefits program can reduce costs by as much as 20%. For ABC Co., that translates to:

• Annual benefit spend = $729,295 ($2,083,700 payroll x 35%)
• Potential benefit program savings = $145,859 ($729,295 benefit spend x 20%)

Totaling the cost of not communicating effectively
                 Organizational vision          $256,989
                 Individual performance      $110,000
                 Customer communication  $256,450
                 Benefits program                $145,859

                 TOTAL                                 $769,298

Those are significant numbers! They are so significant, you may struggle buying into them. Let’s assume that they are overstated a bit—or, overstated by a lot. Even if the potential cost impact is only 20% of that total, the “cost of doing nothing” for ABC Co. is still $153,859.

I don’t know about you, but I think $153,859 is a significant amount, especially in a company with $500,000 of net operating profit. When it comes to financials, you can either impact the bottom line (what we have identified here) or you can impact top-line revenue. For ABC Co., whose profit margin is 10%, the alternative would be to produce $1,538,590 in top-line revenue. It’s pretty safe to say that that would make you the best salesperson in the company.

So, there are four areas where we all know that communication is critical and likely four areas where you have been offering solutions that don’t pique the interest of prospects or get used by clients. Perhaps if you helped them see the high cost of their current practices, those prospects would find the urgency to work with you, and perhaps your client would find the continued motivation to use what you have put in place.

As I said at the beginning, understanding this high cost is the first step. The second is putting together an implementation plan—and taking the responsibility for its execution—that will ensure your solution is used, and used as intended.

If your solutions aren’t causing prospects to buy and aren’t being used by your clients that do buy, don’t blame the solution. The likely problem is that the known “cost of doing nothing” and “plan for implementation” are missing from the picture.

It’s a picture you are capable of completing, you just have to ask yourself, “How badly do I want to?”

About the Author
Kevin Trokey is President of Benefits Growth Network, a firm specializing in growth strategies for Employee Benefit agencies, departments and producers. He can be reached at kevin@benefitsgrowthnetwork.com.

“THE INNER GAME” Lessons Learned in the World of Sports

Our good partner, Scott Addis, posted a great article I think all of you should read.

Click here to continue reading…

10 Management Secrets That Will Guarantee Business Failure

1. Make sure you hire from the bottom of the barrel – Bad employees are great! They will all but guarantee you a life full of drama. Why be on easy street when you can have a work force run amuck with whiners, thieves, liars and con-artists? Besides, who wants to spend the time and money necessary to do extensive interviews, skill tests, background checks and character assessments?

2. Over promise and under deliver – Tell people what you think they want to hear. It’s a lot more expedient than radical honesty. The fun thing is there is absolutely no limit on the amount of promises you can make. If somebody complains about the last promise you made then make him or her a new one. The fact is people want to be lied to. This “walk your talk” integrity stuff is strictly for amateurs.

3. Keep your business plans to yourself – All this talk about sharing your vision, mission and goals is pure bologna. People like to be kept in the dark. Besides, if mushrooms can thrive in that environment why can’t your employees?

4. Control as much as you can – Spending your time trying to empower other people is just so exhausting. Better off engaging in control and manipulation so that they don’t dare think for themselves. If they try to revolt, then bring in the heavy artillery.

5. Give them all 2s – Everybody knows that the way to motivate people is to scare the “you know what” out of them. One of the best ways of doing that is to give them poor performance evaluations. They will be fearful for their jobs and be motivated to work like crazy just to survive. In fact, it’s probably a good idea to give them disciplinary notices on a regular basis whether they deserve them or not.

6. Create internal competition – Ever see rats climb all over each other in order to get at a piece of cheese? Don’t think this doesn’t work with your employees too. Make it very clear there can only be one good employee every month. This is a particularly appropriate strategy in the sales area. Make sure only one person in your sales organization gets that trip to Hawaii every year. The less in the way of best practices they share with each other, the better your odds of motivating them out of a scarcity mentality.

7. Bag the meetings – This business about holding team meetings is highly overrated. Besides, it just takes people away from doing their jobs. The last thing you want to do is give people another excuse not to do their work.

8. Work ‘em ‘til they drop – Squeeze every ounce out of your employees every chance you get. Never mind that you have to pay them overtime or that they may burn out and make tons of mistakes. There’s plenty more bodies where they came from.

9. Ignore today’s compliance obligations – There are so many personnel law obligations that trying to reach the “Golden Shores of Compliance” is a futile effort at best. Better off letting your exposures run rampant and deal with them in the courtroom. Besides, we just love our lawyers.

10. Train solely from within – Or, forget training altogether! Better off recycling ignorance than employing profound knowledge – which can only be gathered from outside of a system.
SPECIAL BONUS SECRET:

11. Forget your commitments – This bonus secret is a real powerful one and brings us full circle. Besides, your workforce probably isn’t very committed to you. They say they want to work for you for years and then they quit after only a couple of months. What’s up with that?

These secrets will all but guarantee your business failure. One last note: Just make sure you bleed the company to a point of extinction before you employ these powerful secrets.

NOTE: If management failure is not your bag, then take full advantage of the HR That Works website!

Transitioning Employees to Managers

Don Phin goes over Transitioning Employees to Managers in this short video.

Doing a Leadership Head-Check

Many times we run so hard, we fail to step back and take a 50-foot view of our company. Here is a baker’s dozen “head check” questions you and your managers should be asking yourself: 

1. Who are we? Just what is our story? Whether you call it brand, story, culture, it’s about self-definition. Two great examples are Southwest Airlines and Virgin Air. Their story is branded externally with customers and internally with personnel. Of course, every company has a story—what’s yours? If you’re not sure, ask a third party to come in and take a walk around. Then have them take a look at your website. If they have trouble defining it, you’ve missed a great marketing opportunity. To customers and employees.
2. What do we value most? Certainly the answer to this question should be identified in your brand, culture, etc. Is it hidden or stated? Is everybody on board with these values? Where are there conflicts? Is have a life competing with being the top grossing firm? Is executive pay strangling the ability to hire new talent?
3. Where are we going? As the saying goes, “If you don’t know where you’re going, any road will get you there.” How articulate has management been in defining the company’s vision, mission or goals? How articulate are your company’s managers in defining these for their teams? How articulate are each of your employees in defining these for their careers? Do you folks really know where you’re going? Don’t guess at it, ask a few folks. Survey them even!
4. Where do we need to improve integrity? We had a great Webinar guest, Tony Simons, a Cornell University professor who wrote a great book on integrity. In their studies, it is the single factor driving profitability in corporate life. High integrity companies out earn low integrity ones. So, where do you or your company over-promise and fail to walk your talk? Another way to language the concept is that of trust. What makes someone trustworthy is that they have the skills and the desire to be successful. Where can trust or integrity be compromised? Do you have checks and balances to prevent that poor conduct? Are you making a proactive effort to increase trust and integrity or do you fantasize that it will happen naturally?
5. Are we communicating? In the surveys I’ve done with companies, communication is one of the top three challenges faced by every organization. Remember this: the greatest form of communication is dialogue because it creates a “safe place” for communicating. Unfortunately, much of the workforce sits in what I’ve coined “the Culture of Silence.” This means they are far more concerned about judgment from management and peers than they are motivated to contribute a new idea. There will always be communication in an organization, it’s leadership’s choice to make it proactive and positive or allow it to wallow and become reactive and negative.
6. Do we have a standard operating procedure for doing absolutely everything? If not, what’s the excuse? Chances are if you’re an entrepreneur, you’ve read Michael Gerber’s book eMyth. The revelation is to build a business as if we were going to franchise it. Then we know we have our act together. An easy way to generate SOPs is to give people dictation equipment, talk about what and how they do things, have it typed it out, tweak it, and voila, you have a standard operating procedure for everything—from answering the phones to post-purchase reassurance.
7. Who is responsible for what? In another excellent HR That Works Webinar, the presenters talked about the Results-Only Work Environment (ROWE). In order to have that type of high-performing organization, everybody has to be very clear about their responsibilities. If you were to ask the people you manage “What are the three most important things you are responsible for every day?” would their answers match what you expected? Unless they do you have opened up a gap in performance management.
8. How does the cash flow? Are your managers and rank and file aware of how the cash flows in your organization? Fact is, the most dropped and failed course in college is accounting. Fact is, Americans are in a financial mess because they don’t manage money properly. Fact is, those people bring those habits to your workplace every day. In another excellent Webinar we did, Coach George from Dave Ramsey’s organization talked about the importance of bringing financial peace to your company. This does not just include the company’s bottom line, but the impact that financial stress has on each and every one of your employees. Smart companies will educate their employees about dollars and sense. They will be able to read a cash flow statement. They will understand how and where your company makes money so they can do a better job contributing to that effort.
9. What’s the work environment like? The work environment is always communicating. Fact is, it’s never not communicating. I remember one time trying to help out what was, at that time, a Fortune 500 company that brought together a highly skilled group of engineers and had them work on a highly secretive project. Unfortunately, this high-performing team was breaking down and many were ready to quit and go back to where they came from. When I went to go visit them, they literally worked in an office environment with nothing but gray walls as if it were some top secret Manhattan Project. How ridiculous. When I was a kid, if you were surrounded by grey walls, it meant you were in a basement throwing out the garbage or waiting for the bomb drill to end. What did that environment say to these men who were already in a stressed state? What does your environment say to your employees? Is it energizing or something else? Does it reinforce your brand or do something else? Do employees see the difference their work does every day?
10. How do we define success? How do we keep score? What’s it mean to be a winner? Does everybody know the rules to the game? Are some of your employees playing soccer and others playing baseball? In studying companies that won the Baldridge Award, these excellent companies were very good at defining what overall performance meant. Yet, even in those award winning companies, roughly 50% of employees did not know what it meant to succeed on an individual basis. So, has your company done a good job of defining success company-wide and for individual employees?
11. Where are we at risk? Have you done a SWOT analysis lately? Where are your weaknesses and threats? Do you have good risk management to address these issues? Do you have technology vulnerabilities? Turnover problems, offshore competition, outdated machinery, outdated performance management? Talked with your insurance broker about your exposures? Can you insure against these risks or mitigate these risks or mitigate the damages of these risks if they do occur? Obviously, risk exposure is something BP wasn’t very concerned about when building oil platforms in the Gulf.
12. How are we creating great customer experiences? Today is a sound byte instant gratification, what-can-you-do-for-me-now environment. Many products and services are viewed as fungible. What really matters is the “experience” that surrounds them. To me, flying is a fungible product, but I’d much rather fly Southwest than US Air because of the dramatically different customer experience. If your company has any mission statement, it should simply be this: Create great customer/client experiences! What else could be more important in today’s marketplace? What else could better help drive profits? Look at your own personal experience. We love going to Costco, Nordstrom, fly Southwest Airlines, eat at In-n-Out Hamburger. Why? Because of a great experience. Great experiences are addictive. Are clients and customers addicted to a great experience with you?
13. How can we break out of the box? How can we enhance the creativity in our organization? How can we foster new ideas? Do we actually have a process for mining the intelligence of our entire range of stakeholders? See the Creativity Checklist on HR That Works.

Hope that was good food for thought. Here’s to your success!

“Worrying is Not a Business Plan”

 

Read this great article, written by Albert J. Weatherhead, that sums up our philosophy in these challenging times.