the midst of an economy with very little growth, and with U.S.
unemployment levels hovering around nine percent, all business
expenses continue to attract scrutiny from the cost-cutting hawks.
And that leaves business leaders questioning if employee retention
According to a new white paper released by New York–based Madison
Performance Group, the worldwide leader in developing employee
engagement and incentive marketing programs for Fortune 1000
corporations that include CA, Citigroup, Kawasaki and Siemens — the
answer is a resounding YES!
pressure to do more with less continues to guide corporate thinking,
and executives are wondering if programs designed to strengthen an
employee’s commitment and loyalty still make sense in an economy
that has an abundance of idle labor.
Engaged employees — those who are emotionally and intellectually
committed to what they do, and who they do it for — are proven to be
more productive than those who are not. But employee productivity
has not wavered in years. In fact, the average output per employee
has increased. This has occurred while the aggregate national income
level for workers has been in steady decline for quite some time.
Essentially, employees are doing more with less and for less.
“Most employees feel overworked and under-appreciated,” says Mike
Ryan, Senior Vice President of Marketing & Client Strategy for
Madison Performance Group. “They are productive now because they
have to be, not because they want to be, and they are planning to
leave their present employers when the opportunity presents itself.
The surge of productivity that companies have enjoyed will not go on
forever. Businesses that ignore this reality, and that do not take
proactive steps to reconnect with their workforce, run the risk of
being the big losers when hiring heats up again.”
Business leaders who continue to think employees have no options are
playing with fire. While the labor market to date has been
inconsistent — some might say soft — many experts say a new phase of
robust hiring is coming. At the beginning of the year, multiple
economists surveyed by CNNMoney forecasted that an average of 2.5
million jobs would be added to the U.S. economy this year, which
would be the best one-year gain in hiring since 1999. Even the most
pessimistic of those surveyed, David Wyss of Standard & Poor’s,
expected 1.8 million jobs to be added this year, roughly double the
pace of hiring in 2010.
Businesses have digested a lot of bad news recently, but uncertainty
will more likely delay than derail the recovery. Ryan adds, “Keep in
mind that businesses have enjoyed seven consecutive quarters of
rising profits. Third-quarter profits in 2010 rose at an annual rate
of $1.659 trillion, the steepest annual surge since officials began
tracking such matters 60 years ago. At some point, progressive
companies will realize that the path to sustained growth is a
combination of increased employee commitment and additional
Here are five steps businesses should undertake immediately to
reconnect with their employees in order to retain their best and
brightest and create a work environment that’s more attractive to
potential new hires:
• Repair your culture
Two-thirds of employees believe that company culture has a
significant impact on their morale and productivity. A positive
culture aligns corporate strategy with behavioral expectations,
gives employees clarity and purpose, and provides a framework for
a positive environment, workers are more likely to trust their
managers and coworkers, share information and ideas without
hesitation, and contribute discretionary effort freely. Businesses
signal what’s important through their recognition plans, and
companies would be smart to take proactive steps to repair whatever
cultural damage may have been done over the last few years. They can
start by reinforcing the attitudes and actions that characterize
their internal brand — their cultural framework.
• Set the stage for continuous innovation
companies fight for incremental growth, the ability to identify and
leverage new value-creating ideas is a valuable differentiator.
Smart companies know innovations occur when complex thinking is
applied to new problems or opportunities by those individuals who
are intellectually committed to finding more effective outcomes.
These “personal patents” define the best and newest, but often
unshared, best practices emerging within every business.
innovative environments, employees believe that management is open
to new ideas, not averse to experimentation and generally supportive
of prudent risk taking. It is your recognition philosophy that
mitigates the fear of failure that often stifles an innovative
instinct, and it is your recognition platform that can serve as the
place to solicit, acknowledge and socialize those new ideas,
maximizing employee collaboration and operational impact.
• Involve front-line managers
Employees are much more likely to be engaged when they feel their
manager understands what they do well, encourages them to use their
skills as much as possible, and recognizes and rewards their
achievements when they do.
in the face of competing priorities, most front-line managers in
today’s talent economy are not sufficiently committed to the
development of their employees’ capabilities or careers. And in that
regard, they may be taking their cues from the top. McKinsey says
that CEOs and senior leaders are not sufficiently involved in either
shaping talent management strategies or in outcomes.
• Don’t neglect virtual workers
rapid rise of technology has accelerated the growth of the virtual
workforce. This group of employees tends to toil alone, far from
physical interactions with others — and the reassurance others
bring. Distance exacerbates their need to bond and feel connected.
This is one reason why reinforcement activities need to be more
specific and frequent with virtual employees than perhaps with any
While the digital technologies virtual workers use to communicate
and collaborate are sleek, they can lead to misunderstandings that
strain relationships, trust, and a sense of belonging. In other
words, technologies are the variable in the virtual
employee/employer dynamic. An overwhelming concentration of instant
messages, e-mails and text messages dominate virtual workers’
communication patterns and increase the potential that things will
be taken out of context.
Ironically, web technologies can also provide a solution for
companies looking to create a more closely connected employee
society. When integrated with forethought, social-networking
techniques can help companies expand the impact of recognition
across worker communities of common interest.
Employees, once isolated, can build/maintain relationships, share
successes and learn from one another. Companies that have
incorporated social-media-type tools report increased employee
engagement, expanded opportunities for knowledge sharing, higher
levels of innovation, superior customer focus and lower
• Think like marketers
discipline within an organization is more committed to the
development and optimization of its workforce than Human Resources.
But to be better at generating the type of emotional connections
that drive long-term value and loyalty, HR teams will need to start
thinking and executing like their marketing colleagues.
Marketing teams have evolved particularly quickly in using digital
media to deliver messages that are more efficient and impactful.
Precision marketing practices that build personalized relationships
with the brand have helped marketing teams gain new respect and
status within organizations. HR teams would be wise to adopt some of
their methods as they look to create, deliver, and sustain a more
meaningful employee/employer relationship.
Companies continue to rebound, yet the unemployment rate has
remained stubbornly stuck around the 9% mark for almost two years.
How unprecedented is that? During the 1982 recession, the
unemployment rate peaked at 10.8%, but that elevated level didn’t
last quite as long — only 19 months.
Workers are now doing more for companies. While the labor inequities
have helped organizations experience a windfall of productivity and
profits, they have also placed a strain on employee morale and
engagement. Survey after survey suggests that a wide-scale worker
defection is forthcoming.
sustain high levels of productivity, organizations will need to rely
less on employee fear and more on recognition techniques that are
proven to spark and prolong an employee’s desire to contribute,”
concludes Ryan. “Without taking action now, employers will be left
with a recession-damaged workplace culture populated by
disenfranchised employees who will leave for new pastures at the
Group has become respected for its ability to create innovative
ideas and strategic incentive marketing solutions. It helps build a
corporation’s competitive advantage in today’s rapidly evolving,
global marketplace. The company has headquarters in Manhattan and
offices in China, Brazil, Sweden and Mexico.)
learn more about Madison Performance Group
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Let Go To GROW
By Doug & Polly White
Small businesses have a big impact on our economy, they:
Represent 99.7% of
Create 75% of net
Employ about 50% of
all private sector workers
Number 22.9 million
U.S. economy is sluggish at best. If it’s to turn around, the above
statistics show that small businesses will have to lead the way.
But, too often, small business owners unwittingly stall the growth
of their own companies.
Authors and business partners, Doug and Polly White, have written a
new book, Let Go To GROW, to help small business owners
understand how to avoid the pitfalls they will inevitably encounter
as their companies grow. It shows these leaders how to direct their
enterprises on a path of continued growth while sidestepping the
traps that ensnare so many.
reading Let Go To GROW, small business owners will discover
that in order to take their business to the next level, they will
have to relinquish certain tasks and their skill set will have to
morph to keep pace with the changing demands of a growing business.
After analyzing more than 100 businesses, the Whites learned that
principals must Let Go To GROW. This insight can
revolutionize a small business, and change lives along the way.
Let Go To GROW
examines the challenges entrepreneurs face as their businesses grow
from micro to small, and from small to midsize. The Whites define
businesses in an innovative way — not in terms of revenue or number
of employees, but rather in terms of management structure.
Accordingly, they define a micro business as one in which the
principal is doing the primary work of the enterprise. In a small
business, the principal is managing those who do the primary work;
when a company reaches midsize, the principal is managing managers.
These may sound like subtle changes, but they define the points
where the principal’s role must change or growth will stall. Their
work uncovered new insights that have not been discussed in the
business world … until now. Through the authors’ extensive research
as well as 50-plus combined years of business experience, Let Go
To GROW explores topics including:
the life-cycle of a business the role of the principal needs to
thing that most often stalls the growth of small businesses
a prospective entrepreneur should know before he/she starts or buys
make good tactical decisions, develop an effective strategy, develop
an effective market segmentation and effectively set goals
core of any successful business is hiring the right people, and how
to do it
inevitable challenges that a company will encounter as it
transitions from micro to small to midsize
effectively document processes and develop a robust set of metrics,
and why it is critically important to do so
of quality improvement and cycle-time reduction
publication chronicles the predictable challenges principals face
and how to successfully overcome them. Unlike many business books,
it addresses not only what needs to be done, but also explains how
to do it.
“During the course of our consulting work,” says Doug, “we
discovered a number of businesses that had stalled because the owner
did not delegate. The principal was out of capacity, typically
working 80-hours or more a week. Their personal life was gone. Their
businesses had stopped growing and profitability was a thing of the
past. We saw other businesses that were in serious trouble because
the principal had delegated prematurely.”
“We wrote our book,” adds Polly, “to help businesses that reach the
junctures where the principal must Let Go To GROW, and all
growing businesses will.”
(Doug and Polly White
are partners at Whitestone Partners, Inc., a management consulting
firm guiding small and midsize businesses through profitable growth.
Combined, they have more than 50 years of experience enabling
companies to achieve their goals.)
more information on the authors