U.S. Lost 20,000 Jobs in January, but Rate Dips to 9.7% - NYTimes.com

 

Labor Market Shows Signs of Reawakening in New Data

The American unemployment rate dipped from 10 percent to 9.7 percent in January, the Labor Department reported Friday, buoying hopes that the worst job market in at least a quarter-century is finally improving.

The economy shed another 20,000 net jobs during the course of the month, underscoring the considerable strains remaining in millions of American households. Yet that marked a continued decline in the pace of deterioration. Economists focused on a host of encouraging signs that suggested recovery following the worst recession since the Great Depression.

Manufacturing added 11,000 jobs in January, the first monthly increase since November 2007, while factories saw a modest increased in the length of the workweek. Temporary workers grew by 52,000, and the overall American workweek lengthened, reinforcing the view that commercial activity is awakening after more than two years of veritable hibernation.

“It does signal that the economy is continuing to improve,” said John E. Silvia, chief economist at Wells Fargo in Charlotte, N.C. “You don’t have a boom, but you have an economic recovery. It’s a positive sign.”

http://www.nytimes.com/2010/02/06/business/economy/06jobs.html?partner=rss&emc=rss

12 Things That Your Employees Don’t Like About You | Easy Small Business HR.com

 

In my role as an employee relations consultant for both supervisors and employees at various companies, I’ve met with scores of workers who have voiced a litany of concerns about the things that they don’t like about their managers.  The goal of this list below is not to pass judgment but, to make supervisors more aware of employee perceptions;  giving those managers who may identify with the concerns expressed an opportunity to make changes over time.

Some of the most common complaints that employees have leveled against their supervisors:

1. Regularly showing preferential treatment to some employees over others
2. Micromanager; no faith in the employee’s ability to perform the job
3. Supervisors who don’t have an understanding the work that they do and the daily challenges that they face
4. Too administrative, (inability to perform the day to day aspects of the job(s) of the people that they supervise
5. Lack of support; particularly when problems occur, (not watching their employees backs)
6. Not having direct access to you when needed
7. Lack of communication and feedback
8. Lack of acknowledgement or praise for special accomplishments on the job
9. Not working as hard as they do, (not in the office, always in meetings)
10. Not being an effective leader.  This perception includes the supervisor that lets peers walk all over them to not dealing immediately with disruptive or difficult employees
11. Not showing your “human” side
12. Not listening/Talking over them/Ignoring them

Dianne Shaddock is the Founder of Easy Small Business HR.com, a website which provides “Quick and Simple Human Resources Strategies for Small Businesses, Non Profits, and Entrepreneurs.  Go to Easy Small Business HR.com for more tips on how to hire and manage your staff more effectively.

Turnover During the Recession

Turnover During the Recession

SHRM data from its human capital database indicates that the recession influenced hiring, turnover and profits. The data show that hiring plummeted by 30% from 33 to 23 as a median number of positions filled, while revenue per FTE declined from $200,000 in 2006 to $126, 984 in 2008 and net income declined by more than half -- from $1,648,000 to $800,000 -- during the same period. The data also revealed a decline in turnover, most likely because the scale of the downturn hit all areas of the job market, leaving few job openings for which to apply, even for educated and skilled job seekers. As such, employee turnover dropped from 16% in 2007 to a low of 8% in 2009.

If the job market begins to recover, organizations are likely to see their turnover rates begin to climb. This is causing some organizations to consider what they can do to avoid losing their most valued employees.

Reengaging Employees

Concern about the impact that the long recession has had on employee morale and engagement will influence HR decisions throughout 2010. In the early part of the year, employers may be relying strongly on their current workforce, at a time when many may be reaching burnout or looking for opportunities elsewhere. Not only has the recession been a long one, with employees dealing with significantly heavier workloads for extended periods as their organizations have attempted to make do with leaner operations, but many organizations have implemented additional measures such as salary freezes, furloughs, reduced retirement and health benefits, and reductions in working hours.

For more analysis of turnover trends in post-recessionary economy, see the full version of Workplace Visions, available from the SHRM web site.

Money Alone Cannot Buy Job Satisfaction

December 27, 2009: The National

by Martin Dewhurst, Matthew Guthridge and Elizabeth Mohr

Though companies around the world are cutting back on financial incentive programmes, few have used other ways of inspiring talent. We think they should.

Numerous studies have concluded that for people with satisfactory salaries, some motivators other than money are more effective than extra cash in building long-term employee engagement in most sectors, job functions and business contexts.

Many financial rewards mainly generate short-term boosts of energy, which can have unintended damaging consequences. Indeed, the economic crisis, with its imperative to reduce costs and to balance short- and long-term performance, gives business leaders a great opportunity to reassess the combination of financial and nonfinancial incentives that will serve their companies best through and beyond the downturn.

A recent McKinsey Quarterly survey underscores the opportunity. The respondents view three noncash motivators – praise from immediate managers, leadership attention (for example, one-on-one conversations) and a chance to lead projects or task forces – as no less or even more effective than the three highest rated financial incentives: cash bonuses, increased base pay and stock or stock options.

The survey’s top three nonfinancial motivators play critical roles in making employees feel that their companies value them, take their well-being seriously and strive to create opportunities for career growth. These themes recur constantly in most studies on motivating and engaging employees.


There could not be a better time to reinforce more cost-effective approaches. The traditional role of money as the dominant motivator is under pressure from declining corporate revenues, sagging stock markets and increasing scrutiny by regulators, activist shareholders and the general public. Our interviews with human resources (HR) directors suggest that many companies have cut remuneration costs by 15 per cent or more.

Further, employee motivation is sagging throughout the world: morale has fallen at almost half of all companies, another McKinsey survey says, at a time when businesses need engaged leaders and employees willing to go above and beyond expectations.

Organisations face the challenge of retaining talented people amid morale-sapping layoffs that tend to increase voluntary turnover in the medium term. Often, top performers are the first to go. Strong talent management is critical to recruit new ones in, for example, the financial sector, who have been laid off by their employers or feel disenchanted with them.

Yet while 70 per cent of organisation have adjusted their reward-and-motivation programmes or plan to do so during the past 12 months, relatively few have gone beyond direct management of costs. Almost two thirds of the executives we surveyed cited cost reductions as one of the top three reasons for the changes, while 27 per cent made changes to increase employee motivation and only 9 per cent had the goal of attracting new talent.

The regional differences were striking: 45 per cent of the respondents in developing markets, where economies have proved more robust, cited employee motivation as a key reason for modifying incentives, compared with only 19 per cent in the US and Western Europe, where the crisis hit hardest.

Even though overall reliance on financial incentives fell over the past 12 months, a number of companies curtailed their use of nonfinancial motivators as well. Thirteen per cent of the survey respondents reported that managers praised their subordinates less often, while 20 per cent said that opportunities to lead projects or task forces were scarcer and 26 per cent said leadership attention to motivate talent is less forthcoming.

Why have so few organisations made more use of cost-effective nonfinancial motivators at a time when cash is hard to find? One reason may be that many executives hesitate to challenge the traditional managerial wisdom that says money is what really counts. While executives themselves may be equally influenced by other things, they still think that bonuses are the dominant incentive.

“Managers see motivation in terms of the size of the compensation,” explained an HR director from the financial services industry. Another reason is probably that nonfinancial ways to motivate people require more time and commitment on the whole from senior managers.

One HR director we interviewed spoke of their tendency to hide in their offices. primarily reflecting uncertainty about the current situation and outlook. This lack of interaction between managers and their people creates a highly damaging void that saps employee engagement.

Some far-thinking companies, though, are working hard to understand what motivates employees and to act on their findings. One global pharmaceutical company conducted a survey that showed that in some countries employees emphasised the role of senior leadership; in others, social responsibility. The company is now increasing the weight of engagement metrics in its management scorecard so that they are seen as core performance objectives.

One biotechnology company has reframed the incentives issue by putting the focus on recognition instead of reward to inspire a more thoughtful discussion about what motivates people.

The top three nonfinancial motivators our survey respondents cited offer guidance on where management might focus. The HR directors we spoke with, for example, emphasised leadership attention as a way to signal the importance of retaining top talent. When the chief executive of a global pharma company was crafting corporate strategy this year, he convened several focus groups of talented managers to generate ideas about how to create more value for the business.

With the same aims, a leading beverage company asked every executive committee member to meet with the critical people in their own product groups.

“One-on-one meetings between staff and leaders are hugely motivational,” said a HR director from a mining and basic-materials company “They make people feel valued during these difficult times.”

By contrast, our survey’s respondents rated large-scale communications events, such as the town hall meetings common during the economic crisis, as one of the least effective nonfinancial motivators, along with unpaid or partially paid leave, training programs and flexible work arrangements.

While communication is critical, attempts to convey messages about the state of the business often have some spin, one HR director said.

A chance to lead projects is a motivator that only half of the companies in our survey use frequently, although this is a particularly powerful way of inspiring employees to make a strong contribution at a challenging time. Such opportunities also develop their leadership capabilities, with long-term benefits for the organisation.

A HR director in the basic-materials industry explained that involvement in special projects “makes people feel like they’re part of the answer and part of the company’s future”.

A leading company from the beverages industry, for example, selected 30 high-potential managers to participate in a leadership programme that created a series of projects designed and led by the participants.

“Now is the time to swim upstream and invest more in our high potentials,” said the HR director when launching the programme this year. With profitability returning to some regions and sectors, we see signs that bonuses will be making a comeback. For instance, 28 per cent of our survey respondents say that their companies plan to reintroduce financial incentives in the coming year.

While such rewards certainly play an important role, business leaders would do well to consider the lessons of the crisis and think broadly about the best ways to engage and inspire employees.

A talent strategy that emphasises the frequent use of the right nonfinancial motivators would benefit most companies in bleak times and fair. By acting now, they could exit the downturn stronger than they entered it.

Martin Dewhurst is a director in McKinsey’s London office, where Matthew Guthridge is an associate principal and Elizabeth Mohr is a consultant.

Inspire Innovation in Your Company

December 16, 2009: Sparxoo.com

by Katherine Parsons

In a recession, marketing and innovation budgets are often the first areas to trim. However, these areas are more important than ever as consumers become extra selective about their purchases. Now is the time to differentiate your offering to stand out. Outlined below are simple tips you can reference to help inspire innovation in your company. We have distilled practices from some of the most innovative companies today into these five easy to implement lessons:

1. Shake it up. Sometimes routines can lead you into a rut. In order to stimulate innovation, shake things up. Move your desk or, better yet, have the whole office rotate pods. This will literally encourage you to see things in a new light and interact with new colleagues. Also, be sure to allow time to leave the office—to work virtually or just work in shops that might inspire the topic. For example, if you are researching health, go to an organic tea shop and work there. Listening to the conversations and sipping the tea will yield new insights. Furthermore, talking to people outside of your department, and even your company, further pushes thinking.
a. At Menlo Innovations, meetings are often continued outside—literally beyond the meeting rooms
b. At What If?!, no “home desk” keeps people from moving and meeting people

2. Play. Children learn through experimentation and interactions, yet as adults we are often reluctant to experiment. We need to reintroduce play into the environment and support the principles associated with it—including the risk of failure which often accompanies trying ones hand at new and unscripted ventures. An added bonus of play is employee engagement and building a sense of camaraderie and sportsmanship.
a. At Google, gyms and play areas encourage relationships beyond work
b. At Ideo, toys and visual, movable bulletin boards foster play and proptyping

3. Express yourself. Companies should allow employees the freedom of artistic expression and personalization as a way to make them feel “at home” in the office and to inspire their work. Moreover, encourage employees to dabble in areas that they are passionate about—even if it means having an artist try their hand at coding or vice versa. You never know where great ideas come from and what can inspire further innovation.
a. At Pixar, you design your own workspace in the way that inspires you
b. At Google , employees are encouraged to spend 20% of their time on personal “passion projects”

4. Put a stake in it. While it may not be possible for each employee to be a stakeholder of the company, it is possible for each of them to feel like their contribution matters. It is important to motivate employees to action, set metrics and goals to work towards and provide feedback and rewards along the way. Many innovative companies employee a networked, less hierarchical cross-functional team model to maximize employee voice.
a. At privately-held W.L Gore, each associate is an “owner” in the company
b. Pfizer solicits feedback from their employees via a suggestion box program that offers cash bonuses for employee actions that are put into action.

5. Nourish. With so much focus on business results and performance assessment, it is important not to overlook feeding the mind and body as well as the bank. This means focusing on corporate wellness initiatives and individual employees’ wellbeing. Studies have shown that spending money on these enrichment efforts does, in fact, pay off in the long run—a win/win for the employee and company.
a. At Google, besides a stellar free cafeteria, there are also numerous snack pods where employees are encouraged to refuel, refresh and converse
b. At What if?!, praise for the employees is written across the walls and ceiling in the hub area

5 Ways to Grow in Any Economy: Learn to Keep Your Company Moving Even When Things are Stagnant

December 23, 2009: Entrepreneur.com

by Jennifer Brown

Even in tough economic times, small businesses need to find new ideas, develop original products, and engineer fresh market approaches. These are the pillars of good business, and each is made from a mixture of creativity and expertise. While it may seem counterintuitive, it's entirely possible to implement strategies that drive not only employee engagement, but also innovation and, ultimately, sales--all without enormous investment in systems or people.

What can your company do to remain fresh, vibrant and alive--all without breaking the bank? Here are five ways:

1. De-emphasize office space
The traditional office space, where cubicles, the hum of overhead lights, and group politics preside, is not usually the most conducive environment for harnessing the most creative ideas. Giving employees the opportunity to perform some or all of their work outside the office can break this routine and cultivate an innovative workforce.

Often simply changing the physical working location to the café or tea house on the corner can produce a stream of new and valuable ideas. And many of these "third places" provide complimentary wireless internet access, have space for convening, and sell enough coffee to keep everyone alert. Writers and musicians know about the creative effects of a cafe's stimulating and relaxing atmosphere--why not CEOs?

2. Virtualize your workforce
In addition to being ineffective at times, the office space may be an unnecessary expense. The cost of maintaining an office space is usually the single largest line item when it comes to business overhead. Many small businesses have eliminated the expense by ceasing to rent office space and setting up virtually. Transforming your business into a virtual operation creates the new opportunity to hire and retain talented people from outside of your geographic area and frees up funds to be invested elsewhere.

Keep in mind, though, that while there are many benefits to virtualizing a company, the reduction in face time also necessitates a change in management style. Much greater focus is needed on project expectations and deadlines, as well as clear and consistent communication.

3. Leverage collaboration applications
At the beginning and end of the day, your business is about people--the clients you serve and the staff that you employ. Connecting these people in the right way is essential to creating and running a great company, and collaboration applications are excellent tools with which to accomplish this goal.

Collaboration applications create new avenues of communication that effectively improve team cohesion and break down the invisible barriers within a company. Intelligent implementation can turn a stagnant, sluggish company into one composed of engaged employees, who contribute more of their "discretionary time" toward the success of the company.

One excellent collaboration application is GoogleDocs, which creates an online conference table where ideas can be put forward, discussed and implemented. Every document created within the application is saved, so it can be opened and edited wherever there is an internet connection. Novice computer users will find GoogleDocs easy to learn and intuitive to operate. Likewise, instant messaging programs such as Skype or MSN Messenger enable fast communication through chat groups formed around departments or projects.

CPS Creative, a website design company, is a great model for its implementation of collaboration software. The company, which is almost entirely virtual, requires all employees to use the same instant messaging program and be online at designated times. All of the employees assigned to a specific project join the same chat group. Also, at the beginning and end of each work day, all employees check in with their colleagues in order to let them know they have arrived and left.

4. Invest in the skills of current employees
On a regular basis, companies face a host of small but necessary tasks that must be accomplished, like creating a Flash graphic for the website, writing a marketing brochure, or drafting a press release. Yet smaller companies cannot afford a dedicated IT department, marketing staff or public affairs coordinator, despite the fact that many of these tasks, like maintaining a functioning and well-designed website, are essential to attracting new business and transitioning from a struggling start-up to a vibrant and growing company.

Hiring new employees with the necessary skills is not the only solution; invest in the skill development of your current workforce. Your staff most likely either has the requisite capabilities to accomplish these projects or can quickly acquire them. The additional skills will undoubtedly be very marketable, which satisfies your employees while providing for the needs of the company.

One resource to help accomplish this is the website Lynda.com [http://www.lynda.com/], which provides online training in professional-grade applications like Adobe Dreamweaver and Illustrator--the required tools to build quality websites and produce stunning marketing materials.

5. Build cross-functional teams
Finally, one of the greatest methods for producing innovation in a company is to solicit contributions from the entire workforce. Taking your employees, who are the most knowledgeable experts on the company, and gathering them around a conference table will help your company develop innovative solutions with little investment.

CPS Creative once encouraged a non-technical member of their staff to try his hand at Flash design, something that he had never done before. After seeing his immediate aptitude for it, the company merged the product developed by the original Flash expert with the staff member's design, creating a better product in the end.

Regardless of the condition of the economy, companies should always looking toward expansion. Growing while revenue is stagnant is a difficult, but not impossible, task. Consider these five ideas: shifting the workplace away from the office, virtualizing the workforce, using collaboration applications, investing in new skills acquisition, and tapping into the talents of existing employees. All of these strategies are inexpensive and cultivate the essential ingredients of successful small (and someday large) businesses everywhere--workforce engagement, innovation and, ultimately, sales.

Many Workers Eager to Exit

December 23, 2009: Chicago Tribune

The job market remains the worst since 1983, but November's unemployment rate improvement, to 10 percent from 10.2 percent, may begin feeding an employee exodus.

Based on surveys, several management consulting and human resource organizations said about half of U.S. workers are likely to try to change jobs next year.

Among the indicators:

--Right Management surveyed 900 workers and found that 60 percent intend to leave their jobs in 2010.

--The 2009 Employment Dynamics and Growth Expectations Report said 55 percent of employees plan to change jobs, careers or industries "when the economy recovers."

--CareerBuilder.com surveyed 4,285 full-time, private-sector employees. Forty percent said they had difficulty staying motivated in their current jobs, and 24 percent said they didn't feel loyal to their current employers.

Signs that job cuts are easing have prompted management experts to warn employers.

"The best workers are mobile in any economy," a Right Management memo said. "Employee turnover is expected to rise next year," partly because research shows "many workers are unhappy with their present jobs."

A Workforce Management magazine story recently said "layoffs, pay cuts and other fallout from the recession have devastated employee engagement."

Experts in employee retention say staff-cutting and budget-cutting employers must move quickly to restore pay cuts and reward employees or risk losing them next year.

Management’s Dirty Little Secret

December 16, 2009: Wall Street Journal (Gary Hamel's Management 2.0)

by Gary Hamel

How would you feel about a physician who killed more patients than he helped? What about a police detective who committed more murders than he solved? Or a teacher whose students were more likely to get dumber than smarter as the school year progressed? And what if you discovered that these perverse outcomes were more the rule than the exception—that they were characteristic of most doctors, policemen and professors? You’d be more than perplexed. You’d be incensed, outraged. You’d demand that something must be done!

Given this, why are we complacent when confronted with data that suggest most managers are more likely to douse the flames of employee enthusiasm than fan them, and are more likely to frustrate extraordinary accomplishment than to foster it?

Consider the recent “Global Workforce Survey” conducted by Towers Perrin, an HR consultancy. In an attempt to measure the extent of employee engagement around the world, the company polled more than 90,000 workers in 18 countries. The survey covered many of the key factors that determine workplace engagement, including: the ability to participate in decision-making, the encouragement given for innovative thinking, the availability of skill-enhancing job assignments and the interest shown by senior executives in employee well-being.

Here’s what the researchers discovered: barely one-fifth (21%) of employees are truly engaged in their work, in the sense that they would “go the extra mile” for their employer. Nearly four out of ten (38%) are mostly or entirely disengaged, while the rest are in the tepid middle. There’s no way to sugarcoat it—this data represents a stinging indictment of the legacy management practices found in most companies.

So why aren’t we scandalized by this data? I talk to thousands of managers each year and for most of them, employee engagement isn’t Topic A, or B or even C. How do we account for this heedlessness? There are several possible hypotheses:

1. Ignorance: It may be that managers don’t actually realize that most of their employees are emotional zombies—at least while they’re at work. Maybe corporate leaders haven’t seen the many studies that mirror the results of the Towers Perrin survey. Or maybe their allotment of emotional intelligence is so meager that they are unable to distinguish between enthusiasm and ennui.

2. Indifference: Another explanation: managers know that a lot of employees are flatlining at work, but maybe they simply don’t care—either because a callous corporate culture has drained them of empathy, or because they view engagement as financially unimportant—a nice-to-have, but not a business imperative.

3. Impotence: It could be that managers do care, but can’t imagine how they could change things for the better. After all, a lot of jobs are just plain boring. Retail clerks, factory workers, call center staff, administrative assistants—of course these folks are disengaged. Given that, the data’s hardly surprising. After all, prison wardens aren’t surprised that their charges aren’t bubbling with joi d’vivre, and neither are managers.

Let’s evaluate these hypotheses. The first seems to me unlikely. Anybody who has ever read a Dilbert strip knows that cynicism and passivity are endemic in large organizations. Only an ostrich could have missed this.

The second hypothesis has more to recommend it. I believe there are many managers who have yet to grasp the essential connection between engagement and financial success. Companies that score highly on engagement have better earnings growth and fatter margins than those that do not—a fact borne out by another Towers Perrin study, as well as by the work of Professor Raj Sisodia of Bentley College. This correlation between enjoyment and profitability is likely to strengthen in the years ahead. Let me use the example of the Apple iPhone to explain why.

Think about it: how did Apple manage to jump into the mobile phone business so quickly, despite a complete lack of industry experience? The answer: by accessing a lot of commodity knowledge that was available in the form of standardized components from third party suppliers. While this helps to explain how Apple got into the business so speedily, it doesn’t explain why the iPhone has succeeded so spectacularly. Consider this: in the third quarter of 2009, Apple’s iPhone division delivered $1.6 billion in profits, while Nokia earned just $1.1 billion. What make’s these figures eye-popping is that Nokia’s global handset market share hovers around 35% while Apple’s is less than 3%, this according to TechCrunch.

The lesson here: you don’t have to be the biggest to be the most profitable—but you have to be the most highly differentiated. Apple made the iPhone a money machine by injecting it with a lot of non-commodity knowledge. When it debuted in June 2007, the iPhone offered users a unique portfolio of functions: a touch screen display, a built-in music player, a capable web browser, and a suite of useful applications that let users check the weather, track their stocks and watch YouTube videos.

The fact that Apple’s margins are so much better than Nokia’s reflects a simple reality: in making a mobile phone, Apple adds a lot more differentiation to the standard componentry than Nokia does, and Apple adds it in a highly efficient manner. Or to state it another way, among all the various players in the iPhone value chain, Apple has, by far, the highest ratio of differentiation-to-cost, and thus the fattest margins.

In a world of commoditized knowledge, the returns go to the companies who can produce non-standard knowledge. Success here is measured by profit per employee, adjusted for capital intensity. Apple’s profit per head is significantly higher than its major competitors, as is the company’s ratio of profits to net fixed assets.

It doesn’t matter much where your company sits in its industry ecosystem, nor how vertically or horizontally integrated it is—what matters is its relative “share of customer value” in the final product or solution, and its cost of producing that value. The greater the share of differentiation, the greater the bargaining power with business partners. Likewise, the lower the cost to produce that value, the bigger the profits.

Of course, Apple isn’t immune to the forces of commoditization. Within a few months of its launch, many of the iPhone’s original features had been duplicated by its competitors. So Apple had to innovate again. It invited third-party developers to write applications for the iPhone and thereby laid the groundwork for a revolution in portable computing (100,000 apps so far, and still counting). But once again, competitors like Blackberry and Google are in hot pursuit.

So what does all this have to do with engagement? Just this: in a world where customers wake up every morning asking, “what’s new, what’s different and what’s amazing?” success depends on a company’s ability to unleash the initiative, imagination and passion of employees at all levels—and this can only happen if all those folks are connected heart and soul with their work, their company and its mission.

Let me break it down:

– In every industry, there are huge swathes of critical knowledge that have been commoditized—and what hasn’t yet been commoditized soon will be.

– Given that, we have to wave goodbye to the “knowledge economy” and say hello to the “creative economy.”

– What matters today is how fast a company can generate new insights and build new knowledge—of the sort that enhances customer value.

– To escape the curse of commoditization, a company has to be a game-changer, and that requires employees who are proactive, inventive and zealous.

– Problem is, you can’t command people to be enthusiastic, creative and passionate.

– These critical ingredients for success in the creative economy are gifts that people will bring to work each day only if they’re truly engaged. (Eric Raymond made this point way back in 2001 when he argued that in the new economy, “enjoyment predicts productivity.”)

Today, no leader can afford to be indifferent to the challenge of engaging employees in the work of creating the future. Engagement may have been optional in the past, but it’s pretty much the whole game today.

What about the third hypothesis? Sure, (some of you are saying), engagement is important, but let’s not kid ourselves—it’s easy to see how Apple’s super-smart engineers and designers might get excited about creating mind-blowing products, but my company is way more prosaic and a lot of the work around here really is mind-numbing. It’s not that I don’t care about engagement, but I can’t make a silk purse out of a sow’s ear. The reason so few of my people are truly engaged in their work is because so few their jobs are truly inspiring. Isn’t that what the data are telling us?

Uhmm, no. Surprisingly, 86% of the employees in the Towers Perrin study said they loved or liked their job. So what, then, are the culprits? Julie Gebauer, who heads up the Workforce Effectiveness Practice at Towers Perrin, points to three things that are critical to engagement: first, the scope employees have to learn and advance—are there opportunities for them to grow; second, the company’s reputation and its commitment to making a difference in the world—is this a company that deserves the best efforts of its people; and third, the behaviors and values of the organization’s leaders—are they people employees respect and want to follow?

These are all management issues. It is managers who empower individuals and create space for them to excel—or not. It is managers who help to articulate a compelling and socially relevant vision and then passionately pursue it—or not. It is managers who demonstrate praiseworthy values—or not. And more often than not, they don’t. Here, again, the survey data is disturbing.

Only 38% of employees believe that “senior management [is] sincerely interested in employee wellbeing.” Fewer than 4 in 10 agree that “senior management communicates openly and honestly.” A scant 40% of employees believe that “senior management communicates [the] reasons for business decisions,” while just 44% believe that “senior management tries to be visible and accessible.” Perhaps most damning of all, less than half of those polled believe that “senior management’s decisions [are] consistent with our values.”

My conclusion from all of this: first, engagement is essential to the competitiveness of every company and every economy—and we need to be doing a whole lot better than we are. We’ve got to get management’s dirty little secret out of the HR closet and into the boardroom. And second, if we’re going to improve engagement, we have to start by admitting that the real problem isn’t irksome, monotonous work, but stony-hearted, spirit-deflating managers.

If you’d like to DO something about this sorry state of affairs, may I recommend you start by picking up two mind-expanding books? The first, “Closing the Engagement Gap,” is co-authored by Julie Gebauer and contains a wealth of provocative insights and practical recommendations based in part on the findings of the Global Workforce Survey. The second, “Total Engagement,” by Byron Reeves and Leighton Reed, offers a radical prescription for taking the work out work, by making it more like play.

Boosting Employee Engagement With Multimedia Storytelling: Jim Haudan Interview

December 15, 2009: DirectorTom.com

by Thomas R. Clifford

As soon as I had this book in my hands, I knew I had to interview Jim Hauden!

“The Art of Engagement: Bridging the Gap Between People and Possibilities” is not only an engaging piece of work, it’s practical, relevant and compelling. And the real kicker? Jim is a big proponent of visual storytelling.

It doesn't matter what position you hold, what title you have or how long you've been with your organization. If you're wondering how to inspire and connect people to their work and to your organization's "big picture," consider this book your survival manual. Get it. Read it. Use it. Repeat.

Thanks, Jim, for sharing your time and insights with us here. I hope your book and this interview inspires everyone reading this as much as it has inspired me!

Lately, we’re hearing a lot of talk about employee engagement. What is it, really, and why does should anyone care?
“Engagement” has become a somewhat dangerous word in the workplace. Some people think “engagement” is a recycled version of “people are happy here, and we know this because our employee satisfaction scores are high.” But that’s a far cry from true strategic engagement, where people are fully mobilized to bring something to life that doesn’t yet exist.

Strategic engagement requires three things:
1. The ability to think in systems,
2. Being connected to the strategy in the way that’s most relevant to you, and
3. The knowledge that allows you to take actions make a difference

First, engagement absolutely requires the ability to think in systems. Many of the most important things in our lives are systems. It’s critical to see how everything fits together. Then, it’s just as important to see how your own work fits into the whole and how you contribute to the business – how you make a real difference. This knowledge makes you think and act in very different ways. How all this happens is astutely connected to the way people want to be engaged. It requires tapping into their curiosity, helping them feel comfortable and safe in saying what they think, and allowing them to take part in solving the puzzles of the business.

Why do employees become disengaged at work? What are some of the main forces behind it?
Disengagement happens when people see themselves as separate, as doing work that isn’t connected to the success of the business and to what their co-workers are doing. Engagement is defined in ways that are relevant not to the leader, but to the follower. Bigger than all that, disengagement is a result of people not believing that they’re part of the future, that they don’t make enough of a difference. It’s those internal voices that tell us that we’re not really as good as we think we are, that keep us from seeing our place in the system or how we contribute.

Engagement and money. Is there really a connection?
We can cite productivity statistics, satisfaction statistics, and engagement statistics. They all point to the same conclusion – when we tap into the heads, hearts, and hands of our people, we get better results. Better said, we need to access the dormant human potential of all the people in our organizations. Leaders need to help people to bring out the best versions of their people so they can mobilize around the strategy that we are trying to bring to life for the future.

You’re a big advocate of using stories to ignite conversation and move people into action. How can organizations harness the power of multi-media to help employees feel and act more connected to their work and the organization’s mission?
A number of companies are starting to see the difference between using multi-media to “tell and sell” and using it to create insight and to model examples of success. One company calls their examples “proof points” of what behavior looks like when it is in concert with a new strategy. Multi-media can be a powerful way to answer one of the most profound questions that people rarely ask regarding strategy: “What does it look like?” As long as people are concerned that what they think it should look like might be different from what leaders are picturing, they’ll sit back and wait for others to go first. But if leaders can vividly create insight through multi-media in terms of what it looks like when strategy is being executed, we can start to close that gap. We begin to reduce the apprehension that people feel when it comes to taking the risk to bring new strategies to life.

Having engaged employees is only half of the equation. Strategy execution is the other half. How can video or audio stories help leadership execute their vision and strategies so everyone on board “gets it?”
Engagement without purpose is, well, purposeless. It’s like teamwork without a challenge. If you’re pursuing engagement for engagement’s sake, it’s a waste of time. But if you see a challenge that needs to be brought to life, and know that people are the ones who are asked to bring it to life, engagement is the mechanism, and strategy is the target for that engagement.

What would you say to those who think multi-media stories can’t a make a difference in their engagement efforts?
I’d say, “Rethink your assumptions.” Multi-media doesn’t have to be glitzy and aggressive. It can’t be just a show-and-tell in an attempt to persuade people to become motivated and inspired. That’s a total fallacy because people ultimately inspire themselves. As leaders, we create the opportunity for people to be inspired on their own by inviting them to think about the business and their role in it.

Here’s an example. Hampton, one of our hotel clients, is working mightily to redefine the role of a general manager. There are a lot of ways to use multi-media to simply tell people what leadership thinks they need to do to succeed in that new role. However, a better use of multi-media is to create a story that is documented from the associate perspective, the customer’s perspective, and the community perspective. This is the way to show the impact that a general manager has on people’s lives when they lead with excellence. They can figure out the “how’s” on their own.

From your perspective, what’s the biggest mistake people make?
When it’s time to engage their organizations in strategy, leaders can forget what it’s like “not to know.” They may have been working on strategy for six months, and may have become bored by content that hasn’t yet been fully understood by their people! Henry Ford once asked his marketing department, “When are we going to stop running that ad?” The response was, “Sir, we haven’t released it yet.” There is a gap between what’s new to one group and what’s old to another group, and that gap tends to create incorrect assumptions.

Any advice for organizations thinking about integrating storytelling in their engagement strategies?
The key is to make storytelling part of your entire culture. The most successful organizations create the opportunity for people to tell stories that illustrate, reinforce, and personalize the behaviors that are most critical to future success. For instance, if your strategy includes extraordinary customer intimacy, open meetings by telling stories about examples that have occurred in your own life that can be translated into your business strategy. Another example could be risk-taking, ways of providing innovative ways to think about products, services, and processes. Ask people to place a spotlight on this aspect of your strategy by telling stories. Use experiences that people have every day to challenge the way we are executing our strategy.

Jim Haudan's bio:
For the past 20 years, Jim Haudan has not only built a thriving business, but has helped numerous individuals unleash their hidden potential. With origins as a coach and school administrator, its easy to see what led him to co-found a company dedicated to business learning. His innovative, creative methods draw people into a business by tapping into basic human curiosity and intelligence. By fully engaging people in their work, they become ready, willing and able to deliver on company strategies, producing real results. Root Learning has made the list of the Best Small and Medium Companies to work for in America for five straight years and was recently recognized by the Wall Street Journal and Winning Workplaces as one of the top small employers with exceptional workplaces. Obviously, Mr. Haudan is on to something.

Lack of Employee Engagement Hurts Business Performance

December 21, 2009: IT Business Edge

by Ann All

Companies are coming off a rough 18 months. So it's time to regroup, realign business objectives in light of the economic conditions and communicate them to employees. Yet that last step might be suffering, based on research conducted by the UK's Department for Business, Innovation and Skills (Bis).

According to a YouGov survey of more than 2,100 working people, just 24 percent said their employer had clearly articulated its 2010 objectives to the work force. Thirty-two percent doubted there was a plan for their business. Perhaps not surprisingly, only 27 per cent of respondents said they were fully prepared for challenges they would face at work in the coming year.

This lack of communication could be especially worrisome for IT, which as I wrote last week faces a double whammy of low staff levels and heightened corporate expectations. While there's a lot of talk about "employee engagement," it's tough for managers to rally the troops if they're feeling uncertain themselves. Nonetheless, it's important to do so. Poor employee engagement "can put the brakes on improved business performance," said David MacLeod, adviser to Bis and co-author of a report titled "Engaging for Success." He said:

If leaders don't explain where the business is going and what it's seeking to achieve, how can people be motivated or know what they're meant to contribute? Clear goals are a key ingredient for achieving performance and productivity -- but worryingly this research suggests many employers haven't yet grasped this for 2010.

MacLeod said engaging with staff goes beyond the warm and fuzzy and yields financial beneifts. If employee engagement levels rise by 10 percent, companies can increase profits by up to £1,500 (US $2,400) per employee per year.

Need more proof? Researchers who wrote a paper soon to be published in the Strategic Management Journal correlated sales growth with an organizational culture in which employees had higher opinions of their company than did society at large. They saw a 9 percent drop in sales over a year at 28 companies where employees thought far less of their company than customers did. Conversely, sales rose 7.46 percent for the companies whose employees liked it much more than consumers did.

Notice MacLeod's mention of "clear goals?" That meshes well with what Brad Hall, managing director of Human Capital Systems and author of "The New Human Capital Strategy," told me when I interviewed him in October. He suggested coming up with specific goals for each role in an organization -- all of which should be tied to larger corporate goals, of course. Then tie employee training, performance appraisals and incentives to those goals. In that same post, I offered advice from Globoforce CEO Eric Mosley, who said giving employees rewards keyed to corporate values can help improve overall company morale.

Disengaged Workers Cost Billions: Economics Of Engagement Subject Of Study

by Faye Beauchine

December 21, 2009: Travel Procurement

Good managers know intuitively that engaged employees are good for business. To support that precept, the Enterprise Engagement Alliance has gathered an impressive body of research that squarely aligns employee engagement with business results.

In a recent white paper, The Economics of Engagement, independent research from a number of respected organizations--Towers Perrin, the Human Capital Institute, Sears, IBM and Costco--confirms the positive economic impact of cultivating and retaining engaged employees. The studies provide ample scientific support of the financial impact--and shareholder return--of engaged versus disengaged employees.

With less than one-third of U.S. employees engaged, according to both Gallup and Towers Perrin, the upside is significant. It's possible to reclaim some of the $350 billion lost annually by U.S. companies to employee disengagement.

Highly engaged employees expend discretionary effort and that usually translates to bottom-line results. Employees engaged in their work experience a strong connection that taps into emotional and relational efforts--their hearts and minds. These efforts lead to greater results as measured by traditional metrics (productivity, retention) as well as to different approaches (macro rather than micro, delayed rather than immediate effect).

If you're just showing up at work and not contributing discretionary effort, it could be a sign of disengagement. Even major league brands that have never had morale issues aren't immune. For the first time, they have had pay cuts, leave without pay, layoffs--and they don't know how to grapple with these issues.

Companies understand that they need employees to take care of their customers and that engaged employees take care of customers better. Consequently, they are investing in employee engagement as a remedy to the issues facing most companies today: the economy, layoffs and doing more work with fewer people. It serves as a reminder to employees that they and their contributions are valued and that they can make a difference in business today.

What has accelerated the importance of engagement are concerns that when the economy improves, employees who feel disengaged will jump ship the first chance they get, leaving their employers struggling to maintain an effective workforce.
Some companies and CEOs understand the value of engagement and the new measurement methods. While there is no simple formula to achieve higher engagement, there are some fundamentals. The organization needs a solid culture and value system that supports engagement. Senior leaders have to drive the process. Managers must be selected and developed with employee engagement in mind. And employees must be made partners in the process.

Measurement tools, best practices and techniques also exist. The most important unanswered questions about employee engagement programs are how the various elements of the programs (training, communication, recognition, incentives, etc.) affect the outcome and what is their cumulative effect on engagement.

Decision sciences (analytics) can isolate the variables in specific programs and determine what works and what doesn't. Constant data analysis offers insights that allow us to predict, in any situation, what elements provide the greatest impact--and at what cost.

So engage your employees, measure the impact and grow your business.

Fay Beauchine, Carlson Marketing engagement and events president, serves on the executive committee of the Enterprise Engagement Alliance--a coalition of marketing communication, incentive, media and research firms that sponsored the white paper authored by Human Capital Institute president Allan Schweye. Beauchine also is president of the National Business Travel Association Foundation and president-elect of the Site International Foundation.

How to Keep Morale Up in a Down Economy

December 7, 2009: MSN Business on Main

by Toddi Gunther

Speak to employees at companies where cost-cutting and layoffs continue and it'll be clear that any talk of the recession being over isn't having much of an impact on workplace morale.

But while it might seem challenging to keep employees in this position focused, motivated and productive, it's essential for companies to engage them and inspire them to do their best. This isn't just talk, either, as studies have shown that high employee engagement correlates with strong business results like better performance, improved job retention, increased job satisfaction and organizational loyalty, and reduced stress.

"The willingness to go the extra mile, motivation to perform to the highest standards, creative energy applied to work, and interest in the company's success … is the secret sauce of successful companies," says Marcia G. Rhodes, spokeswoman for WorldatWork, a global association of human resources experts.

Ken Thomas, author of "Intrinsic Motivation at Work: What Really Drives Employee Engagement" and co-author of a measure of employee engagement used for management training and organizational change called the Work Engagement Profile, agrees: "It is a win-win [because] organizations need their workers to be engaged, but workers also want their work to be engaging."

Thomas notes that because today's work is more likely to be in the service sector rather than the manufacturing sector, more judgment and creativity are required from employees. "In this environment, then, good work isn't just about complying with routines and rules," he says. "It requires a deeper level of commitment and psychological involvement — a different degree of motivation."

To that end, small-business owners actually have an advantage over large corporations when it comes to keeping workers engaged. That's because "employees in small companies are much closer to the results of their work," says Cindy Ventrice, a workplace consultant and author of "Make Their Day! Employee Recognition That Works." And when employees can see the value of the work they do and make the connection between their job and the greater good of the organization, they are much more likely to be engaged.

So, in light of all the benefits of employee engagement, what exactly can small-business owners do to keep their employees loyal and productive? Don Lowman, managing director of strategic growth for human resources services at Towers Perrin, a global professional services firm, advises companies to do five things well for employees: know them, grow them, inspire them, involve them and reward them.

With that framework in mind, here are a few simple strategies that companies can use to initiate and/or improve employee engagement:

Spend time. Business owners need to spend time with their employees, answer their questions, and continually reinforce each employee's value to the company, says Rhodes of WorldatWork. "Money pays the bills but it doesn't engage the spirit, inspire enthusiasm or drive innovation," she says.

Implement recognition programs. Increasing the amount of recognition employees receive often increases engagement, says Ventrice. One strategy she recommends is to start a recognition notebook. A manager writes a note of praise or appreciation for an employee and then either passes it along to someone to do the same or leaves it somewhere for another person to write in. "It becomes a traveling trophy of positive comments and a permanent reminder of all the accomplishments," says Ventrice. Another strategy: Give away gift cards of small denominations for a job well done and then ask the recipient to name two or three others who helped to get the job done and give them gift cards, too.

Provide meaningful feedback. Communication, says Rhodes, even if negative, is what employees crave. According to a new Leadership IQ study, 66 percent of employees believe they have too little interaction with their boss. The study also shows that 53 percent of employees say that when their boss does praise excellent performance, the feedback does not provide enough useful information to help them repeat it.

While keeping employees engaged is hard work, the upside is that your employees will work much harder because of it.


Toddi is an award-winning journalist, writer and editor and currently is a contributing writer covering career management issues for The Wall Street Journal.