The Performance Improvement Blog

Employee Satisfaction and Engagement Once Again Linked to Financial Success

Still another study , recently published by The Forum at Northwestern University, supports the notion that satisfied and engaged employees are essential to the financial success of companies. Dr. James Oakley, now Associate Professor of Marketing at UNC Charlotte's Belk College of Business, led this comprehensive study of these factors across a sample of 100 media companies. His research team surveyed a representative group of employees in each organization and received responses from 5,568 employees, averaging about 60 respondents from each company. They decided on doing the research within one industry in order to prevent some of the problems that occur when collecting data from a heterogeneous sample of businesses. Several different survey instruments were used to measure culture, climate, HR managerial practices, and market characteristics affecting each company.

• They used R.A. Cooke and D.M. Rousseau’s (1988) definition of organizational culture: “…the ways of thinking, behaving, and believing that members of a social unit have in common.”
• They defined organizational climate as: “…the way that organizations operationalize their culture in daily routines and behaviors.”
• HR managerial practices included selection, development, performance management, and compensation.
• Market characteristics included customer satisfaction, retention, and loyalty. And profitability was used as a proxy for financial success.

The following chart represents key factors that were identified and the positive and negative relationships among these factors.

A major finding was “… a direct link between employee satisfaction and customer satisfaction, and between customer satisfaction and improved financial performance.”

Based on their findings, the investigators recommend the following:

1. Ensure that the employee voice is being heard up and down the organization and that they feel they are making a difference.
2. Regularly survey employees about the strengths and weaknesses of the organization and take visible action based on that information.
3. Develop a healthy mix of employee cooperation and competition for the benefit of customers.
4. Establish clear performance objectives related to the customer experience and recognize employees for achieving those goals.

What I like about this study is that, unlike so many studies done by consulting firms, this research examines intervening variables that explain how and why employee satisfaction and engagement are linked to financial outcomes of companies and how culture and climate contribute to the employee experience as well as the customer experience. Of course, one could still argue that the links are not necessarily causal. It could be that company profitability causes high levels of employee satisfaction and engagement rather than the other way around. But at least in the case of this research there is a compelling theory to go with the data.

The study adds to evidence that is piling up around the impact of employee satisfaction and engagement on organization success. As we emerge from a depressed world-wide economy, the long-term financial success and sustainability of companies will be more important than ever. Therefore, we need to pay greater attention to the conditions that contribute to a positive and supportive work culture. Now, if we can only get leaders to pay attention to these factors in their organizations. 

 

How to Keep Talent from Walking Out the Door

Are you worried about employee turnover in your company and how it might get worse once the economy improves? If you aren’t worried, you should be.

It has been estimated that as many as a third of employees are looking to change jobs. Now that the recession is easing and more companies are beginning to hire again, these employees will start acting on this desire.

My friend and colleague, Bernie Donkerbrook, retired Ford Motor Company program manager and now executive coach, places responsibility for retaining talent on the shoulders of an employee’s supervisor or manager. Bernie believes that there is much those managers can do to keep their employees engaged and productive. He writes:

In today's sluggish economic environment, companies operate lean, demanding more of employees in the process. Many are focused on surviving, not thriving. While uncertainty in the marketplace may keep employees loyal today, when the economy improves, they may be more apt to seek out career opportunities elsewhere. If organizations ignore the retention issue today, they will undoubtedly regret it tomorrow.

You should be asking yourself, “What am I doing to ensure that my key talent remains once the job market improves?” and, concurrently, “What am I doing to strengthen loyalty and build a positive work force, positive people, and good relationships with their immediate bosses?”

Here are actions you can take to increase employee retention (all of which are behaviors that can be coached, trained and developed in supervisors and managers):

• Improve relationships between employees and their immediate bosses. Many employees leave because they perceive that they are not appreciated, recognized, and valued by their immediate bosses.  Here is what you can do:
  • Have HR determine if there are supervisors/managers that have a higher than normal turnover rate in their units. Provide them with a coaching process for understanding and dealing with difficult issues. The supervisor’s/manager’s behaviors need to be understood and changed. There is usually a reason some bosses have higher turnover rates than others.
  • Make it clear to supervisors/managers that employee retention is part of their job and that long-term development of employees is part of their job, too...and part of their evaluation.
• Revitalize your organizational culture to include employee appreciation, recognition, and valuing.  “People honor a culture that honors them.” This is incredibly important…honoring, valuing, respecting and recognizing your people.  It makes a big difference in building loyalty to the company and also is definitely teachable.

• Remind your managers and supervisors of the power of the “Golden Rule” of behavior at work.
  • How would THEY like to be treated by their bosses?
  • What would THEY like to experience in their jobs?
  • How would THEY like to be recognized, appreciated and thanked for their efforts?
  • How long will THEY want to wait to be appreciated, recognized and valued?

• Tell your best people they ARE your best people. It is highly motivating to know you are well thought of. Let your best people know you want to keep them, to retain them with the Company.  Really… it makes a difference. Imagine yourself being told by your boss, or your boss’s boss, that you are important to the Company and they are counting on you.
• Ask employees what they need, want, would like to be doing. No promises, but it shows you are interested and want to make it work for them and the company.  For your best and key people, make sure they have a career development plan. This is so obvious but managers and leadership are so busy they often fail to take this seriously.  And, there is often no corporate plan to set this up.
• Ask employees for feedback on YOUR management behavior. How can you improve? What would they like to see more of and less of from you? Are you helping too much or not available often enough?
• Carve out one-on-one time with your employees.  Much successful retention and employee loyalty comes from, simply, one-on-one time with the boss.  Regularly demonstrate personal care and concern for individuals, their life and family, and what is important to them.  (Bosses may need coaching/mentoring on how to do this effectively.)
• Put people to work where they are their best.  Allow them to work at what they already do well, where they have excelled, and what they are excited about.  Ask them.  Everyone wants to be doing what they know they are good at and what they enjoy doing.
• Find out what inspires, motivates a person.  What is that person passionate about? Find that person work in these areas if at all possible.  At least, let him or her represent the company externally in the areas where there is passion.  This builds the corporate brand and demonstrates corporate engagement with the local community.    
• Find out if career growth opportunities are available for employees.  Do they have opportunities for development, growth, new challenges, and promotion? You may answer, as the manager, “Yes, of course.”  But what do your employees say about this?  There is often a disconnect between what employees experience in career development and what the company policy is said to be.  Do this:  Check it out. Find out what employees believe and what they experience on the job relating to career development. Most often, you, as the boss, will not like what you hear.
• Ensure that compensation is competitive. Eliminating any gap in compensation with the market is a great short-term neutralizer of negative energy.
• Pay for performance.  Do you reward better performance or is everyone at a similar grade-level paid about the same?  If everyone is paid the same, it is not very enticing for the highest performers when they know they are not appreciated in a financial way for their unique contribution to the organization. [Note: Plan pay-for-performance very carefully; these plans can have little or no positive effect if structured in the wrong way.]
• Pay attention to your stars, your top-performers.  Really! Stars will not wait around to be given authority, more responsibility, the opportunity to make decisions, or be promoted.
• Communicate, communicate, and communicate.  Find ways to let employees know you care about them as individuals.

Bad News is Good News

When evaluating programs and organizations, bad news can be good news. What I mean by that is any feedback is helpful to an organization if leaders listen to the feedback, look for value in the information, and make improvements accordingly. However, what so often happens is that leaders immediately become defensive and look for ways to discredit or cast doubt on criticism. Almost impulsively, they look for ways to find fault with negative feedback and only accept high ratings and praise. The tendency is to automatically try to identify the people who made critical comments and explain away what was said because of who said it: “They’re always complaining”; “That person is poisoning the well for everyone else”; “We couldn’t give them raises this year so they’re angry”; and on and on.

Some organizations have a culture that is so insular they can’t hear bad news. The National Collegiate Athletic Association (NCAA), “founded more than one hundred years ago as a way to protect student-athletes”, appears to be one of these organizations. In a series of columns written for the New York Times, Joe Nocera has described some examples of the NCAA failing to act in the best interests of students. He writes:

The N.C.A.A. claims — as it always does — that it is acting to protect its athletes “from exploitation by professional and commercial enterprises.” But this is classic N.C.A.A. Orwellian spin. Its true purpose in preventing athletes from engaging with agents while in college is to exacerbate their exploitation. The professional and commercial enterprise doing the exploiting, of course, is college sports itself.

I can’t vouch for the accuracy of the facts that Nocera cites, but it does seem that the NCAA is not making use of this opportunity to look at itself in the mirror and make improvements. Rather than accepting the feedback and explaining what they will do to make the NCAA a better organization for students and its member institutions, organizational leaders have become defensive and have attacked Nocera in the press. Dave Pickle, a long-time employee of the NCAA, wrote a blog post about Nocera titled, “News not fit to print.”

This isn’t a constructive response, especially by an organization that has responsibility not only to its member institutions but also to the wider public.  One of the primary ways in which organizations learn is by periodically examining what they do and what stakeholder’s (customers/clients, employees, suppliers, wider community, etc.) think of what they do. If leaders do not listen to the “bad” as well as the “good”, they cannot learn. Barriers to listening, such as the argumentum ad hominem defense, do not allow for continuous improvement. Like the NCAA, a culture can develop in organizations in which these barriers become ingrained in the way they do business. “Bad news” should provide an opportunity for learning and change. Great organizations turn bad news into news they can use.

 

There They Go Again: Bashing Brainstorming

What did brainstorming ever do to receive such vitriol? Jonah Lehrer writes in the January 30 issue of The New Yorker:

Typically, participants leave a brainstorming session proud of their contribution. The whiteboard has been filled with free associations. At such moments, brainstorming can seem like an ideal mental technique, a feel-good way to boost productivity. But there is one overwhelming problem with brainstorming. It doesn’t work.

Susan Cain writes in a January 13 opinion piece for the New York Times titled “The Rise of the New Group Think”:

…brainstorming sessions are one of the worst possible ways to stimulate creativity. The brainchild of a charismatic advertising executive named Alex Osborn who believed that groups produced better ideas than individuals, workplace brainstorming sessions came into vogue in the 1950s. …But decades of research show that individuals almost always perform better than groups in both quality and quantity, and group performance gets worse as group size increases… People in groups tend to sit back and let others do the work; they instinctively mimic others’ opinions and lose sight of their own; and, often succumb to peer pressure.

And now Cliff Kuang raises concerns with brainstorming again in an article for Fast Company titled, The Brainstorming Process Is B.S. But Can We Rework It? At least Kuang is asking how to make brainstorming more effective. Let’s brainstorm some possibilities (just kidding).

As I wrote in a previous blog post, “I believe the problem is in the implementation, not the method.” Indicting brainstorming is like saying that elearning is more effective than classroom-based learning. The truth is there is effective elearning and there is ineffective elearning. It all depends on the purpose, design, content, and delivery of the course.  

It’s the same with brainstorming. It all depends on the quality of design and facilitation. The critics are right; if all the facilitator does is allow participants to free associate for an hour and then go home, the process is “B.S.”. When that happens we can predict little creativity and little impact on planning.

However, when it is done well, when it is done in context and with preparation of participants, and when there is follow-up after the initial generation of ideas, then brainstorming can be very effective. A good facilitator:

1. Is clear about the purpose and intended results of the exercise and discusses this with participants
2. Prepares (even trains) participants for doing brainstorming (e.g., gives an example)
3. Establishes norms for how participants are to behave in the session
4. Leads the conversation in such a way that gets everyone involved, gets all of the ideas displayed in front of the group, and does not allow criticism until all ideas are listed
5. Helps the group reach consensus on a subset of ideas on which to do further work
6. Begins action planning to do the follow-up work
7. Helps participants learn (and learn how to learn) from their involvement

There is an art and science to brainstorming. The facilitator must be able to follow the rules of brainstorming but also deviate from and expand on those rules depending on the situation.  

When done well, there are many uses of brainstorming. It could be used to evaluate a program, consider new strategies and methods, identify problems, create a vision for the future of an organization, or solve problems.  Often, brainstorming is used simply to warm up the group for a lengthy strategic-planning or prolbem-solving discussion. The technique creates an atmosphere of trust where everyone is heard and all ideas are respected. Now, what’s wrong with that? 

 

Can Groups Be Creative?

It would be easy to become anti-teamwork after reading “The Rise of the New Groupthink”, a Sunday New York Times opinion piece written by Susan Cain, author of the forthcoming book, “Quiet: The Power of Introverts in a World That Can’t Stop Talking.” She writes a thought-provoking article that challenges the prevailing thinking about employee innovation and creativity. In effect, she makes the case for solo innovation. While I agree that organizations try to do too much in groups, I fear that an article like this might prompt managers to throw the baby out with the bath water.

Cain starts with this generalization about workplaces:

Most of us now work in teams, in offices without walls, for managers who prize people skills above all. Lone geniuses are out. Collaboration is in.

This describes the image, not the reality. First of all, most of us are in work groups, not teams, at least not the kind of teams that Katzenbach and Smith (and others) define as being a team. And work group meetings tend to be poorly planned and badly run. I’ve posted about this previously. As for people skills, managers sure don’t act like these are prized abilities. A command-and-control management style still dominates the workplace. And regarding collaboration, too few managers and employees know how to collaborate effectively. To them, collaboration means ccing everyone on an email.

There is much rhetoric about teamwork and collaboration, but these behaviors are still very rare in organizations today. So to indict the current work environment as not being conducive to creativity and innovation because it is too collaborative misses what is actually happening in the typical workplace. In fact, employees are not collaborative enough.

Cain is also critical of group brainstorming.  She writes,

…brainstorming sessions are one of the worst possible ways to stimulate creativity…The reasons brainstorming fails are instructive for other forms of group work, too. People in groups tend to sit back and let others do the work; they instinctively mimic others’ opinions and lose sight of their own; and, often succumb to peer pressure.

I believe the problem is in the implementation, not the method. Any group that makes a list of ideas these days calls it “brainstorming”. This is not the kind of brainstorming which results in new and better ideas. When done right, brainstorming is free-flowing, non-judgmental, and relies on the dynamic interaction of everyone in the group, regardless of status. Unfortunately, every manager thinks that he or she can manage a brainstorming session. After all, how difficult can it be to ask a question and make a list of the answers? However, effective brainstorming requires highly skilled facilitation and not every manager has the skills and temperament needed to provide this to a group. An effective brainstorming leader ensures that everyone is engaged in the work, encourages everyone to contribute their own feelings and beliefs to the conversation, and doesn’t allow one or two people to dominate the conversation.  

Isolating everyone and putting up barriers to interaction is just as counterproductive as forcing everyone to interact with others all day long. Some people need some quiet and solitude to be at their productive best and some people need some social interaction. Even the research cited by Cain supports this notion. Not everyone in the research populations she cited seeks isolation. The last thing you want to do is label someone “introvert” based on an assessment tool and then make that person toil alone until they come up with the next big idea. While some people can’t tolerate frequent interruptions, becoming tense and irritable, others thrive on the chaos and perform best in that kind of high-energy, social environment. 

We need to do a better job of helping employees figure out in what kinds of environments and on what kinds of projects they work best and provide those conditions for them. We need managers who take responsibility for helping employees optimize performance. And we need leaders who can build teams that nurture creative and innovative thinking.

Thank you, Susan Cain, for stimulating this blog post.

 

Ban Those Words!

In my last blog post, I wrote about the Harvard Business Review blogger Dan Pallotta and his post titled, “I Don't Understand What Anyone Is Saying Anymore.” He writes about business buzz words and how they get in the way of clear communication. Speaking of words that do not improve communication, Lake Superior State University recently announced its "37th annual List of Words Banished from the Queen's English for Misuse, Overuse and General Uselessness."

The words for 2012 are:

1. Amazing
2. Baby Bump
3. Shared Sacrifice
4. Occupy
5. Blowback
6. Man Cave
7. The New Normal
8. Pet Parent
9. Win The Future
10. Trickeration
11. Ginormous
12. Thank You In Advance

Read the entertaining comments about these words on the LSSU Web site.

What words do you think should be on the list? "Learning Organization" would be my nomination.

What Do You Mean?

Dan Pallotta, president of Advertising for Humanity and HBR blogger, in a post titled “I Don't Understand What Anyone Is Saying Anymore”, writes about business jargon and how it affects communication in organizations. The blog post must have hit a nerve because it has broken the record for most comments to a single HBR Blog Network post.

One of these comments is a perfect way to begin 2012. That is, with humor that pokes fun at ourselves and the way we talk to each other. The commenter, BrainToniq (Scott Ohlgren), writes as if talking to his staff:

While in the run-up to transitioning in this phase of right-sizing and redeployment, we still need to—at the end of the day—drill down and make sure that our mission-critical, goal-oriented core competencies are in alignment and on the same page as the most current best-practices paradigm. While we as a customer-centric longtail company are still on the runway, we need to each firewall enough time to allow out-of-the-box thinking and strategize the low-hanging fruit in the marketplace. Envisioning the metrics here will require accountability management on each team member to come up with a value-added solution that doesn’t require putting out fires or a lot of bandwidth. Bottom line? The truth is we have to step up, work smarter, not harder, and create a Web 2.0 solution. This is an exciting model for limitless potential and mutually agreed synergies!

I’ve got an open door policy, so touch base and keep me in the loop. If we can move forward and proactively get on the same page about this, it’ll be a win-win-win. Remember: our people make the difference.

Come again? The truth is this is how we sound sometimes. And with email, text messaging, and all of the forms of social media, the use of buzzwords to replace plain speaking has gotten much worse. We are sacrificing clarity for brevity, which means there is greater risk of miscommunication.

Dan Pallotta’s solution is to “speak authentically” in communicating with employees and customers. He writes:

You will gain tremendous credibility, become much more productive, make those around you much more productive, and experience a great deal more joy in your working life if you look someone in the eye after hearing one of these verbal brain jammers and tell the person, "I don't have any idea what you just said to me."

Let's hope communication improves in all of our organizations in 2012. 

A Year of “The Performance Improvement Blog” in Review

It’s that time of year again. It seems like everyone has their top this or top that from 2011. Not to be left out, I thought I would do a little year-end reflecting of my own.

Throughout 2011, I used this blog to shed some light on critical leadership and management issues. The topics ranged from “the vision thing”, to shaping organizational culture, to improving the effectiveness of employee training programs, to building trust, to breaking down communication silos, to doing better presentations, to seeing organizational blind spots, to increasing employee engagement, and more.

Out of all of these blog posts I’ve selected five that seem to have had the most interest for readers. They are:

Hospital Culture Trumps Equipment and Techniques - Culture, with all of its values, assumptions, beliefs, expected behaviors, and norms, is a powerful force within organizations. Culture shapes how things are done. In hospitals, culture has life and death implications. Evidence suggests that health care outcomes are improved when the culture of a hospital encourages trust and honesty among staff and with patients and when people act consistently in accordance with these values.

Kirkpatrick’s Four Levels of Training Evaluation: A Critique – I explain why evaluating training by using a survey that asks trainees questions about each of the “Kirkpatrick Four Levels” is a flawed way to determine if that program is having a meaningful impact on an organization. Although a four-levels survey is a very common way to approach evaluation of training in organizations, it probably will not provide managers with the information they need. I suggest an alternative approach.

Performance Management is Broken - What is intended to pass for performance management in too many organizations today is the annual compulsory performance review. To label this a “performance management system” is to give the process much more credit than it deserves. A perfunctory meeting between a manager and employee once a year to review a standard rating sheet that lists competencies and goals that are probably no longer relevant, is not a performance management system.

How to Use PowerPoint – Millions of presentations are given every day using some form of slideware, often PowerPoint. It is an important communication tool of managers. Yet, management’s messages are not getting across. I frequently hear that employees didn’t know something that had been mentioned in an all-staff presentation, or that they didn’t realize its importance, or that they didn’t understand what it had to do with them. Apparently, PowerPoint slides are, in many cases, failing to communicate key messages. I refer the reader to suggestions for more powerful PowerPoint presentations.

20 Signs of Employee Disengagement - An important question for all managers is, “Do I have an employee engagement problem in my organization?" You don’t need an organization-wide survey to answer this question. Pay attention to what your employees are saying and doing. Look and listen for the clues. This blog post lists twenty tell-tale signs of disengagement.

Wishing you a healthy and prosperous 2012! 

 

Data is Not Knowledge

I like this quote by the Swedish author Henning Mankell that appeared in a Sunday New York Times op-ed column titled “The Art of Listening”:  “

Many people make the mistake of confusing information with knowledge. They are not the same thing. Knowledge involves the interpretation of information. Knowledge involves listening.

We are awash with data and information. Numbers, facts, and observations are constantly at our fingertips in our Blackberrys, iPhones, and Droids. Online newspapers, magazines, and social media smother us in sense and nonsense. Marketing and survey research companies publish mounds of opinion data daily. The key question we must ask ourselves is, “Are we learning anything? Are we turning that data and information into knowledge that can be applied for the betterment of our organizations?”

TED and the pecha-kucha movement provide excellent examples of how data can become knowledge and move people to action. Those presenters tell a story about their data that engages people emotionally. They realize that just because someone has data doesn’t mean they have knowledge.

This graphic, from Epic.graphic, makes the point: 

 

Organizational Blind Spots

How many times in the past week have you told yourself or someone else what you would have done if you were that graduate assistant who says he witnessed a child rape in the shower room at Penn State University, or if you were Joe Paterno, their legendary football coach, or if you were the President of Penn State? The reality is, you don’t know what you would have done. We all have blind spots to the truth that prevent us from doing the right thing in certain situations.

David Brooks writes about this phenomenon in his op-ed column, Let's All Feel Superior, that he wrote for the New York Times. He says in that column:

Over the course of history — during the Holocaust, the Rwandan genocide or the street beatings that happen in American neighborhoods — the same pattern has emerged. Many people do not intervene. Very often they see but they don’t see.

Some people simply can’t process the horror in front of them. Some people suffer from what the psychologists call Normalcy Bias. When they find themselves in some unsettling circumstance, they shut down and pretend everything is normal.

Some people suffer from Motivated Blindness; they don’t see what is not in their interest to see. Some people don’t look at the things that make them uncomfortable.

Some people look, but often don’t see the unexpected. Daniel Simons and Christopher Chabris demonstrated this in their classic research on perception. Observers concentrating on completing a task did not see a gorilla walk across the screen in front of their eyes. We see what we expect to see and, literally, don’t see the things that are not usually there. Drivers in areas of high bicycle activity see the bicyclists on the road, while drivers in areas of few bicyclists don’t see the bicycle in front of their car until it is too late.

Although physical and moral blind spots are tragically apparent at Penn State, the potential is in all of us. A co-worker is running a Ponzi scheme, we don’t want to believe it, and we look the other way. The sales department inflates revenue for the year and we make excuses why it is okay to report the numbers in that way. A manager is verbally sexually abusive to members of his team and we ignore it. In all of these situations we would like to believe that we would do the right thing. However, individuals, teams, and whole organizations put up many barriers to the truth.