Loyalty in the Workplace

Loyalty in the Workplace By Chris Woolard Chris Woolard, Walker's employee loyalty expert shares his thoughts on all things related to employees and the workplace.

This month marks my 10th year at Walker.  Over that time, I have done hundreds of employee loyalty/engagement surveys on companies in a variety of industries, sizes, and parts of the world.  A fairly consistent area of weakness is long-term training and development.  Companies continue to ignore this problem in hopes it will go away.  Unfortunately, what usually happens is the employee is the one who goes away, to a company who cares about offering long-term training and development. 

Companies complain about providing new skills and abilities to their employees for fear they will be more marketable and leave.  A former colleague of mine always fought that argument by telling these companies they have two choices, they can train their employees and they might leave, or they can not train their employees and they will stay, leaving you with an untrained and unmotivated workforce.  

Cisco is a company that understands the importance of training and development and is willing to invest in it.  This article outlines their program for giving training and development to high performers.  The cost is about $10,000 per employee.  However, the program has already generated ideas that could net the company billions, not a bad ROI.  Also, only two of the 360 participants in the program have left the company.  That is a company that understands the importance of training and development employees rather than face the alternative. 

This article summarized a recent study that found high performers had a large drop in their levels of engagement compared to last year.  All employees had a drop in employee engagement but high performers dropped 25%.    I have written about this a couple of times before (here,  here, and here).  Not only will there be a mass exodus when the economy turns around but many of those leaving will be the high performers that are critical to the success of the organization.  So what are companies doing about this? 

Nothing.

I have talked to several others in the employee loyalty/employee engagement/HR Consulting area and they are not seeing increases in activity.  I continue to hear from CEOs and heads of HR, "This is important and 'ping' me in 2010."  First, I hate the use of the word "ping", but second by 2010 it will be too late.  Companies need to take action now. 

Compounding the problem of high performers exiting companies when the economy turns around is many employees re-evaluate their careers at the end of the year and numerous employees will be setting goals to find a new job in 2010.  

Companies that are taking action now will be way ahead of the curve and in a better competitive position to take advantage of new opportunities versus those that are just thinking about planning something maybe sometime in 2010 (or so...maybe). 

While Walker is not a perfect company, I have been doing this for 10 years and have yet to find a perfect company, I think there are several things Walker does that other companies could learn from.  I have already covered the Paid Time Off Policy and the work itself.  In this blog, I am going to cover a potpourri of small things that all contribute to the overall culture of Walker.  

First is the flex-time.  At Walker, most of us can pretty much come and go as we please.  As long as we are hitting our goals of client related work and our clients our happy, we can come and go as we please.  Having three kids and one on the way, I cannot tell you what a blessing it is when something comes up at home to know I can leave and take care of my personal matters.  I recognize I need to make sure my work is done but it is such a relief to know I have that flexibility.  

Second are the free drinks.  This seems like one of those small, silly things but I do believe it helps contribute to the culture here.  Walker has free coffee (Starbuck's and Seattle's Best) along with free Pepsi products.  I do not drink coffee or too many Pepsi products except for Mountain Dew.  I firmly believe Mountain Dew is the nectar of the gods and drink way too much of it.  Maybe this is not such a perk since every evening I have a major sugar crash. 

Third is the dress code.  Walker has a casual dress code, which basically means wear a nice shirt and jeans.  There are times where I need to dress up and actually wear a shirt and tie probably at least once a week.  It is sure nice if I do not have any client facing meetings to know I can wear something really comfortable to work.  I know some companies are moving back to a more formal dress code as they feel it helps the employees have a more professional attitude and be more focused.  For me, I am very comfortable and relaxed in jeans and feel more productive because I am more comfortable.  If I could wear shorts and a t-shirt, I would do it in a second, which is probably a large reason why that is not allowed.

Fourth is the attitude of Senior Leaders.  All of the Senior Leaders are very approachable and down to earth.  That may seem like something that is very common, but having dealt with many Senior Leaders, I can assure you that is not the case.  They all say they have an open door policy, which is often talked about but rarely practiced.  I really feel like I can go to any of them at any time and ask them a question.  They also know us on a personal level. For example, I was talking to a Senior Leader a couple of weeks ago and he remembered how many kids I had, that we were foster parents, that we home school, and that my wife is a stay at home mom.  I was actually surprised because they have so many important things to keep track of, to remember intimate details of my family meant a lot.  This also makes me feel comfortable going to them with new thoughts and ideas as I know they will listen. 

In my last blog, I wrote about one of the reasons Walker made the list of Best Places to Work from Consulting Magazine.  There are a couple of other reasons why I think Walker made the list and I will continue to share these reasons over my next couple of blogs.

In this blog, I want to focus on the work Walker does.  Walker has transformed from a research company to a consulting company over the past several years.  As part of that transformation, we have gone from just delivering a bunch of numbers to a client, to giving our clients information that can impact their business and then working with them to maximize the impact the information has on the organization. 

Recently, we had a client where from one survey with us, we saved the client over $21 million dollars and they gained an additional $30 million in new revenue all from using the data we provided in the ways we recommended. 

While at initial glance, it may seem like we just do surveys and provide numbers (and yes, my wife still calls me a data geek) but what we do in actuality is positively impact our client's business.  We can actually see and articulate the impact we are having.  When you can see the impact you are having and the fruit of all your efforts can be seen in actual business results, the work goes from being a job to something one can be passionate about.  

Walker recently made the list for the Consulting Magazine's Best Places to Work for small consulting firms (20 to 499 consultants) in the U.S.  Often in my blogs, I focus a lot on what other companies do and industry trends.  I thought I would take a couple of blogs and turn the mirror on ourselves and focus on what Walker is doing that helped it make the Best Places to Work list.

First let me clarify the award.  Consulting Magazine is a magazine devoted to the consulting industry.  Over the past several years  Walker has shifted its focus from a research company to a consulting company.  This award is not only a recognition of Walker being a great place to work but also Walker is a consluting company.  We feel the award is more significant than the standard Best Places to Work in Indiana or wherever, as we were compared to our peers and came out as one of the best.  

One of the aspects where Walker excelled was Work/Life Balance, ranking second.  There are many pieces that go into Walker being excellent for work/life balance.  One of the biggest is the paid time off (PTO) policy.  Walker associates get over five weeks off a year, yeah that is right, I said over five weeks off.  This is an addition to the standard company holidays (Christmas, 4th of July, etc.).  They do not delineate between sick days and vacation days.  This eases the administrative burden of HR and management to deal with doctor's notes and tracking if it was PTO or a sick day. 

I was talking to a friend of mine about work and we got to talking about vacation times.  He was telling me if he is sick, he has to take a vacation day.  He can only take a sick day when his vacation days are gone.  What a stupid, stupid policy.  This is not some small mom and pop shop he is working for either, it is a national engineering firm.  So let's play this out, I am sick, do you think I am going to take a vacation day to stay home?  There is no way, I am going to come in, even though I am probably not going to be very productive and will probably infect the office with whatever bug I have.  Rather than stay home for a day and get the rest I need so I can come back to work at full strength, I am going to come into work and this bug will drag on for days.  What message does this policy send to the employees?  This tells me the company is going to penalize their employees for getting sick and staying home.  That is what this is, taking a vacation day for being sick is a penalty. 

This PTO policy is just one aspect, I will go into a few more over the next couple of days. 

I know I have written about this before but until it starts to sink in, I will continue to write about it.  Leaders that do not believe they have an employee morale issue right now because there are no options available are taking an extremely short-sighted and downright dangerous approach to running their business. 

Yet another study confirms organizations are going to be in trouble with a mass exodus of employees once the economy turns around.  A study done by Hudson (a recruiting firm) has found employees are disgruntled with the additional workload they are being asked to take on.  They are doing it out of fear of losing their job right now.  As soon the economy turns around, there will be a mass exodus from those companies who are not treating their employees the right way. 

The article mentions three things to help with employee morale:

1.  Communication- Be as transparent as possible.  I think employees understand the tough decisions Senior Leaders are forced to make now.  What they want is to understand what is going on and why.

2.  Continue to develop employees.  I recognize budgets are tight but there are creative and inexpensive ways to develop employees, things like creating mentor relationships, on-line training tools, etc. are great ways to ensure the workforce remains sharp and ready to take advantage of the opportunities that become available as the economy turns around.

3.  As soon as possible, unfreeze wages and bonuses.  I have talked to many employees during this recession who accept the freezing of wages because they realize it was either freeze wages or be out of a job.  They will expect when the company turns around that wages will thaw and raises and bonuses will be instituted again. 

Well, we knew it would happen.  Marketing guru Fred Reicheld is now applying the Net Promoter Score (NPS) to employee surveys now.  This was bound to happen because Fred is a great marketer and this was the next logical step in the evolution of NPS.  So now we have the Employee Net Promoter Score (ENPS). 

The concept is similar to the customer NPS.  You use the likelihood to recommend question, have a scale from 0-11 and subtract the Promoters (answering 9 or 10 on the scale) from the Detractors (answering 6-0 on the scale). 

The beauty of this approach is in its simplicity.  Everyone likes to have their one number they can track over time and this number is easy to understand and easy to track over time. 

One of the problems is we have found almost 40% of employees who are not engaged or loyal to a company will still recommend the company as a good place to work.  So only looking at recommend is not necessarily an accurate measure of employee's perceptions of their workplace. 

In actuality, using the ENPS is probably a fine thing to track in and of itself.  It is important that the right questions are being asked the right way and the information is being used in such a way that it is having an impact on the organization.  You can't ask just one question and expect to get useable data that can help create change in an organization.  To me, the question is not necessarily what is the one number, but what questions are asked and how is the information used.  

If you want to read more info on NPS and ENPS, below are a sites that have more info:

-Vovici blog on ENPS

-Walker blog on NPS

-Walker article on NPS

I stumbled on this article on CNN.com.  It shares the 43 weirdest things said in an interview.  What does this have to do with employee loyalty and loyalty in the workplace?  I have no idea.  I just know it is a gray, rainy day here in Indy and these cheered me up so I hope the do the same for you.

Let me share a personal story of a dumb thing to say in an interview.  One of my best friends was interviewing for a job and was asked the traditional question, "Where do you see yourself in five years?".  His response was, "Hopefully laid up at home with a work-related injury"  Now, this was a quote from a popular morning radio show and my friend had hoped if he said this, it would break the ice a bit and loosen up the interview.  My friend said the interviewer clearly did not listen to the show because he did not crack a smile, just stared at him for a moment and then moved on to the next question.  He did not get the job. 

Do you have any funny interviewing stories?

A recent study by Adecco found some troubling times might be ahead for companies when the economy turns around.  I know that sounds counterintuitive that companies might struggle when the economy turns around.  Companies may struggle with a serious talent drain with employees jumping ship as soon as the economy turns around and opportunities become available.  Here are a few of the key findings from the study:

• The majority of respondents indicated they are at least somewhat likely to look for a job when the economy turns around. 
• The Generation Y group was even more likely at 71% indicating they are going to look for a job when the economy turns around. 

This is a message I have been trying to hammer home that companies must take care of their employees now, even with high unemployment rates and the (inaccurate) perception that employees do not have opportunities available.  By taking care of their employees now, I believe they will be less likely to leave when the economy turns around.  I recognize the need to be cost conscious during this time but you cannot focus so much on the bottom line that you neglect the employees. 

I do see a small bit of silver lining.  44% of those 60 and over are planning to delay retirement.  For years, we have been hearing about the talent gap that will occur when the baby boomers leave the workforce.  From the looks of things, this may be delayed for a while until baby boomers can replenish their retirement funds. 

As I mentioned in my last blog the perceived talent level of the applicant pool has not risen much despite record unemployment.  This makes me wonder if companies are just jettisoning their dead weight. 

If so, why are they waiting until now?  It is pretty rare that a company does not know who the good employees are from the bad ones (if they don't know, they have a whole set of other issues).  I recognize that in a few rare cases, a bad employee can turn into a good employee with training, coaching, etc.  Those cases are rare though.  

I believe by removing the bad employees, it will actually help improve employee loyalty.  In most companies, there is a problem in consistently applying employee policies and the execution of the policies is a key driver of employee engagement.  What could be more inconsistent than treating bad employees the same as good employees by allowing them both to collect a paycheck (probably for similar amounts) while the good employee is probably carrying more of the load and giving the organization a better return on its investment.  This kind of behavior is common in organization and is a good way to get rid of the good employees and keep the bad ones. 

I was talking to Brian Koma at Vovici last week.  He said he had talked to a few HR representatives and asked if they have noticed any improvements in the talent of applicants.  You would think the answer would be yes given the high unemployment rate.  However, he found the answer to be no, HR representatives are not seeing much difference in the talent level of applicants.  So then who is out there? 

I believe a lot of companies are cutting the dead weight, or people they probably should have let go a long time ago and are now using the economy as a reason to get rid of them.  I know there are some good employees out there, I have a few friends out of work right now, and I know they are bright, hard working individuals.  However, I think a lot of what is out there is not necessarily the cream of the crop. 

This makes me wonder a couple of things: 1) If these people should have been let go a long time ago, why weren't they?  2)  Why do companies continue to not care about employee loyalty when there continues to be a market for highly skilled and talented employees?

I will talk more about these two in my next blog. 

I was on a call yesterday with our partner Vovici. During the call, we began discussing making HR relevant. Over the past several years, there have been a number of articles and presentations I have read and heard on making HR relevant. Those were during good economic times. Now, during these times, HR needs to work even harder to become relevant as Senior Leaders could see HR as a place to cut, especially entry-level or mid-level HR staff.

One way to make HR relevant is to tie HR initiatives to the business. Too often, HR initiatives are done because they feel right. There needs to be an ROI to every initiative. Here are a couple of examples:

• By measuring employee loyalty you can tie that to changes in business metrics like turnover, productivity, referrals, etc. You can also tie employee loyalty to customer perceptions. Once HR starts talking about impacting the customers, they will be seen as strategic and move from irrelevant to necessary and critical.

• If a training session is conducted, is there a noticeable increase in productivity?

• HR can review hiring practices to determine how much it is costing to replace a worker and how well they are doing placing employees.

This is a perfect opportunity for HR to send a message on how critical they are to an organization. I find HR to generally be risk averse, but if they are willing to step out and be seen as a critical and strategic part of the organization and not just a necessary evil, HR can emerge from this time as a key element in the success of any organization.

In my previous blog, I described a Trapped employee.  Now the questions becomes, what do you do with Trapped employees?  Well it depends (how is that for a solid answer), it depends on who is Trapped.  For example, hospitals today may have to trap their nurses in order to keep them.  Without the necessary nursing staff, hospitals run the risk of not being able to utilize all of their beds or they could overwork their staff which could lead to a host of other problems.  Now ideally, the nurses would be Truly Loyal to the hospital (want to be there and plan to stay) but hospitals might throw money (which is a great way to trap somebody) at the nurses in order to get them to stay, even when they may want to leave. 

Organizations can make improvements in the organization that will make the company a better place to work.  This will in turn move the Trapped employees to the Truly Loyal category as they no longer feel neutral or negative about the organization but realize how great the company is and thus, they want to be part of the organization. 

Finally, I have clients that I have worked with that may try to help some of the Trapped employees "graduate" from the company.  In some cases either it is just not a fit, or they just aren't a good employee.  In either case, sometimes the best scenario for the organization and the employee is to help them move on to another opportunity. 

I was recently sent this article on employee satisfaction.  The point of the article is employee satisfaction ultimately rests with the employees, as long as the organization provides an open, ethical workplace.  I think employee satisfaction or employee loyalty is a two-way street.  Responsibility rests with both the employee and the organization. 

The author makes several points I want to comment upon:

1.  "Employee satisfaction should be an outcome."  I agree with this, by making the work environment one where employees want to be there, satisfaction or loyalty will come as a result. 

2.  "[E]thical, moral, respectful treatment of employees should be a given in workplaces."  It should be a given, and if it were, I think companies would have more loyal employees.  However, this is just not the case.  Nationally only about 6 out of 10 employees view their company as an ethical company and just over half of the employees view Senior Leaders as people of high personal integrity.  So these things should be a given, but unfortunately for many, many companies, they are not.

3.  "[T]he discussion about employee satisfaction should be about how to engage and empower employees."  I completely agree, satisfaction is a minimum threshold of workplace happiness but has little impact on employee behavior.  However, the author goes on to say you can select employees who are engaged and empowered already.   Huh?  I recognize there are going to be characteristics that you would like to select on that would increase the likelihood of the employee being successful.  ExactHire is a company that is an expert at determining what makes employees' successful and then hiring on those characteristics.  What I am confused about is, how can you select someone who is engaged before they enter the workplace?  They might have characteristics that highly engaged employees tend to have but I do not think it is quite so clear cut as just hiring those who are engaged and empowered. 

4.  The author would like to do a "better job of providing a framework of expectations and goals that sets employees free to contribute because they know where they are supposed to be going and what they are supposed to be doing. And, I’d like to get better at providing regular feedback and only rewarding and recognizing real contribution."  I agree, this is where the companies' role in employee loyalty comes into play.  I have worked with 100s of companies over the past 10 years, many of which are on the list of Best Places to Work.  These companies are very progressive and considerate of how they treat the employees, they truly are a Best Place to Work.  I feel like the article tries to make the point that employee satisfaction is all on the employees, while it is a two-way street, clearly the company has to provide an environment where employees can be successful. 

5.  "Do you care about the satisfaction of employees who aren’t performing at their utmost for their customers, their coworkers, and the business? I don’t. In fact, I want them gone."  I think this is a somewhat short-sighted view.  While initially this makes sense, you don't want employees who are not performing, what about employees who might be satisfied and a high performer, if certain company policies were modified (flexible work schedules, better development path, benefits)?  There are many factors that influence the employee-employer relationship and while a couple have been mentioned here, there are many others that can impact the relationship.  Just writing off employees with such a broad brush approach is not healthy for a company.

6.  "It’s not my job to make up for an employee’s lifetime of blah experiences, bad parenting, poor outcomes, half-baked contributions, failure to take responsibility, and unhappy life choices. All I can do is create a respectful work environment in which employees know what is expected and are enabled to do their jobs – successfully and effectively."  While it is not the job of HR, it is a fact that HR will have to deal with this, unless there are only 2 people in the company.  Humans are complex, emotional beings, not robots, so their lifetime of experiences is what makes us who we are.  Just explaining to employees what their job is and giving them what they need, does not necessarily equate to a happy and productive employee.  There are other factors in the employee-employer relationship that must be considered. 

7.  "Employee satisfaction is largely a choice employees make. I’ll try to stay out of their way while they create it."  I don't agree with this at all, neither does the author.  I think this could be rephrased to say, if I make the company one that employees want to be part of, and give them what is necessary to be successful in their job, then you can get out of the way and let the employees decide if this is the company for them. 

I was recently interviewed by Norm Heikens with The Indiana Business Journal. His blog was about the economy, the impact it is having on employee movement, and what the future holds.  I enjoyed the blog, along with the comments so I thought I would share it with you here. 

The last question in this series on five common questions in conducting an employee loyalty survey is, how do I use the information?

One of the worst things a company can do is conduct an employee survey and do nothing with the results.  It would be better for a company to do nothing than to ask for employee opinions and not act on them. 

What I have seen work best is to create a cross-functional team of 5-10 employees.  Their job is to digest the information, help communicate the results, solicit feedback and suggestions, and create the final action plans.  The team should be comprised of employees from various departments and positions, although I would not recommend putting an employee on their boss on the same team.  You can have team work on all of the action items or have a different team assigned to each action item.  I like having different teams (with maybe one or two common members across all teams to help coordinate and facilitate) as this gives more employees the opportunity to help create change in the organization.  Not only does this create buy-in because it is no longer just an "HR" initiative but it also helps the employees grow and develop by doing something that is not part of their typical job but is valuable to the organization. 

These teams can be at any level of the organization.  Some clients will have teams at the total company level only while others may have teams going on at different regions or even different departments in the organization.  It really depends on the culture, size, and complexity of the organization as to the specific structure of the teams. 

Once action plans have been created, smaller implementation teams can be created to ensure the action plans are carried out.  It is generally not necessary to have 5-10 people on the implementation team as the implementation team is more about execution and less about brainstorming.  The implementation team's responsibility is to ensure the specific actions are carried through. 

I hope this series on the five common questions in conducting an employee survey.  If you have any suggestions or any questions on conducting an employee survey, please leave a comment and I will address it. 

The next question I want to cover is figuring out what areas to work on after an employee loyalty survey has been conducted.

One of the biggest mistakes I see companies make is they only work on the lowest rated questions.  The problem with this is the employees may not care if you improve the areas they rated the lowest.  No matter how much the organization improves those three areas, it will not have any impact on changing employee behavior and ultimately have no impact on the organization. 

There are a number of methods to determine which questions matter the most to the employees.  You can ask a simple importance question along with the standard rating questions, a chip-allocation series can be used, and there are statistical techniques that can be used to derive importance.  Each of these methods has their advantages and disadvantages.  The point is if you use some sort of importance/impact measure and combine that with performance ratings, now priorities can be determined by seeing the entire picture and not just one piece.  Often an area for improvement might be an area that is fairly positive but because it matters so much to the employees, even a small improvement in scores will have a large impact on employee morale. 

Another problem with acting on data is figuring out what specific change needs to be made.  No survey is going to give you the silver bullet in determining the specific change that needs to happen.  All good surveys will give you guidance though; perhaps things like development for the long-term, fairness of evaluations, etc.  It is often valuable to read through the comments as these will help give you the specific "thing" that needs changed.  Comments can help provide meat around the quantitative questions asked in a survey.

Focus groups are another way to dive deeper into a specific topic to determined exactly what needs fixed.  I have found if you give a focus group a topic like "How can evaluations be executed more fairly" employees will give you their specific changes.  Then it is a matter of sifting through all of the changes recommended to determine the specific change to implement. 

The next blog will be the last in this series and cover how to use the information from an employee loyalty survey. 

The next common question relates to higher response rates.  I am often asked how can I get a higher response rate or if the company has never done an employee survey before, they want to ensure they get a good response rate.  Below are some tips to ensure a good response rate: 

-Have a Senior Leadership sponsor.  Having a Senior Leader stand up and say the employee survey is important to them and they fully support it, shows the commitment the company has to the survey.  This Senior Leader should have their name on the communications and where possible, talk about the survey in employee meetings.  The employees will be more likely to believe the company will act on the survey results, and thus more likely to complete the survey if a Senior Leader takes ownership of the program. 

-Open communication and dialogue on how to complete the survey and what will happen to the results.  My last blog discussed the types of communication that need to happen to make an employee survey successful. 

-Act on the information.  The worst the thing a company can do is conduct a survey and not act on the results.  Employees will be more likely to complete future surveys if they see you took the time to make changes in the company based on the feedback from the survey.  I will be writing a blog next week on how to act on the information. 

-Ensure confidentiality.  Employees will be less likely to complete a survey if they fear their responses will not be kept confidential.  Hiring an outside third-party will help with the perception that results will be kept confidential.  What will help the most though is showing that you will not use the results of the survey against an employee.  This will help create trust and employees will be more comfortable completing the survey.  It is not uncommon to have a small group of employees who complain about confidentiality but if you are open and honest about how confidentiality is ensured, how the results will be used, and do not single out an employee for their responses, the majority of employees will feel comfortable giving their honest and open feedback.   

My next blog will cover, how to know what areas to work on.