Some of the Best Things are Free

sherrie-suski-satisfaction

That statement is never more accurate than when talking about employee satisfaction.  Employers often create employee surveys to discover ways to boost employee satisfaction and retain employees.  They think of programs with hefty price tags including, incentive pay, additional benefits, and perquisites. When reviewing results of such surveys, many employers are concerned they won’t be able to respond to employee needs/asks that surface. However, they may be missing existing internal satisfiers that are already in place but are not being utilized. In some cases, attention to current programs and opportunities can reap great rewards and be real opportunities for employee satisfaction.

Career growth and even professional relationships are often motivators of satisfaction and engagement. One of the reasons employees leave a company is career growth opportunities.  Career growth does not have to be the typical upwardly mobile, vertical track, but can be horizontal growth as well.  Many employees would relish the opportunity to become more involved in a different part the business.  A reason employee stay is the relationships made in the workplace. One survey showed 25 percent of departing employees revealed that they would have stayed in their position with the company if they had a more respectful and connected relationship with their direct manager.  Employees are human beings who want to feel that others care about them and that includes their direct supervisor.

Employees want to learn and experience healthy professional relationships. Management must connect with workers both professionally and personally, and, depending on the work atmosphere and nature of the company, create a fun work environment.  Initiating conversations about things outside of work is one way managers can show an interest in their employees’ lives. Other things managers can do to build employee satisfaction are:

  • Allow employees to use and demonstrate their strengths. Everyone wants to be valued and make a difference. Know where to place each employee for the greatest results. Ask what an employee wants to do in the company and look for opportunities to create the experience.
  • Ensure employees understand the goals of the business and how the work they are doing impacts those goals.  Make sure they understand how they fit into the big picture. Individuals on a team create winning scenarios when everyone knows their role and the rules of the game.
  • Enhance communication. Really listen to your employees. Ask what is and is not working and take action to explore where the company can and cannot implement idea changers. Have managers meet with employees on a regular basis and report on performance, engagement, and employee feedback.
  • Consider stay interviews to understand engagement and exit interviews to understand turnover better. Especially for your HiPo’s, conducting regular stay interviews pays off with better engagement and less risk of them turning elsewhere.
  • Create a learning environment. Foster internal opportunities to learn from one another and expand upon existing skills. Implement programs like “a Day in the Life” where you employees get up to eight (8) hours a year to shadow someone in a job that they would like to know more about.  While this may cause a hiccup on that particular day, future projects led by a well-rounded work teams will create greater quality, be more productive and come up with winning solutions faster.

Don’t fall into the trap of thinking that it costs thousands of dollars to ensure that your employees rank high in satisfaction.  Sometimes all it takes is a little bit of thought and a lot of care.  

Workplace Giving

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There are a number of ways that employers can support employees in their desire to give back, especially during the holiday period.  Employers themselves, can, of course, contribute to a charity directly, but, in the spirit of engagement, it is more special to allow employees a say over how the dollars or donations are being distributed.  Some employees will want to give to a specific charity that supports a cause near and dear to them.  Others will want to give to a specific person who they know is in need over the holidays.  Below is a description of the many ways that employers can facilitate the spirit of giving.

Workplace Giving through Deductions

If you work for a company, organization or the federal government, chances are you’ve had the opportunity to participate in a workplace giving program. Workplace giving is an easy and efficient way to make tax-deductible donations to the charities you care about with donations taken directly out of your paycheck. 

This type of giving can be set up through payroll and can be a one-time gift or can be set up as per paycheck deductions of either a percentage or dollar amount.  Many organizations will choose to match, at least to some degree, the dollars that employees contribute.

Employer Provided Donations

Some employers give their employees each a certain amount that they may contribute to any charity or person of their choosing.  The employers only ask, in return, is that the employee share what they choose to use the dollars for.  This can yield especially heartwarming stories of how the employee “spent” the money and what the surprised recipient’s reaction was.  Sharing these throughout an organization can spur others to think about ways they can actively better the life of another.

Non-cash Donations

Certainly not all contributions need to be in cash.  Opportunities abound over the holiday period for employees to bring in food for food drives.  Numbers of organizations will welcome the extra set of hands if groups of employees are available to help sort, shelve and package food items for delivery.  Some services, such as Meals on Wheels will allow the delivery of the food baskets also.

There are wonderful opportunities to make a child’s holiday bright be buying an extra gift or two as you are shopping for others on your list, to brighten a deserving child’s holiday.  Large organizations such as the Marines run annual campaigns like Toys for Tots, but smaller neighborhood organizations run gift drives as well.

Organizations may choose to set up an Angel Tree where an employee picks the name of a family or child and on the back is a description of the wants/needs of that family.  Companies can provide ornaments to replace each card that is chosen until the whole tree is filled with beautiful ornaments, a reflection of what has been given back.  

These are just a few ways that each and everyone one of us can feel what the true meaning of the holidays is all about- giving freely of our time and love to those around us.  

Acquisition Considerations for Human Resources

pexels-photo (6)You have just been told that your Company will be acquiring another Company.  Although your first question could be “How will this impact me?”, your first question should be, “Is this an asset sale or a stock sale?”  There are many implications for Human Resources in any type of an acquisition, but some will depend on which type of acquisition it will be.  You and your team are likely to catch the first wave of questions and work that will follow. 

 

Stock Sale

Let’s talk first about the definition of a stock sale versus an asset sale.    A stock sale is when your Company is acquiring all assets and liabilities of another company.  In a Stock Purchase, all of the outstanding shares of stock of the business are transferred from the seller to the buyer. The buyer in effect steps into the shoes of the seller, and the operation of the business continues in an uninterrupted manner. Unless specifically agreed to, the seller has no continuing interest in, or obligation with respect to, the assets, liabilities or operations of the business.

Asset Sale

On the other hand, in an Asset Sale, the seller retains ownership of the shares of stock of the business. The buyer must either create a new entity or use another existing entity for the transaction. Only assets and liabilities which are specifically identified in the purchase agreement are transferred to the buyer. All of the other assets and liabilities remain with the existing business and thereby the seller.

 

Organizational Structure

In both cases you need to begin to build out your organizational structure of the combined entities as soon as possible.  This will act as your guidelines for interviewing and assessing employees for future roles. The employees who will be, as well as your existing employees, will be anxious to know about any changes in the organization, their positions, location of their work and/or the reporting structure. You also need to have your people, particularly the top-level of the new organization, in place quickly. Frequent and early communication from leadership will reduce anxiety on both sides. 

Policies and Procedures

In both situations you will need to figure out what the company being acquired has in place for their policies and procedures and how they align with those that you have in place.  Frequently there can be a meeting of the minds where you can take the best of both worlds and adopt new P&P’s.  Not only does this give you an advantage but is a nice show of collaboration to the employees being acquired. Especially, understanding the differences in both leave policies and having a transition plan before the close date is critical to reducing employee disruption and managing expectations.

Benefits

In most cases, when it is an asset sale, you will be able to choose which liabilities to exclude from the sale, such as the 401(k) plan provided by the seller.  In a stock sale, you will be required to assume all the benefit plans, at least for a period of time, and may not exclude any up front.  

Other benefit considerations, which we will explore in more detail next time, include how to handle FSA’s, LOA’s, 401(k) account balances and outstanding loans, bonuses and medical deductibles and out of pocket maximums.

Acquisitions bring a lot of uncertainty but also a lot of excitement around the possibility of building a bigger and better entity…….. almost overnight!

Why Internal Bid Programs Yield the Best Candidates

pexels-photo-70292 (1)Internal bid programs have long been considered to be one of the best sources for hires and promotions.   In fact, some sources indicate that existing employees make up over half of all successful candidates that filled positions in 2016 in some of America’s larger companies.

Even though the average posting may only attract 4-5 internal candidates versus an average of over 200+ external applicants, (or 1000’s if your ads are not written correctly) those internal candidates are far more likely to be successful as the final candidates.

So, doesn’t it makes sense to have a formal internal bid or internal mobility plan in place?  Well, yes it does, although one poll found that only 28% of Fortune 500 CHRO’s actually had a well-defined plan.  

Well defined would include:

    • Well thought out- put some real time into what type of plan will work best for your organization
    • Documented- get it down on paper, so to speak.  Make sure the steps make sense and that you have the technology to support it
    • Communicated- plan different communication mechanism- an employee newsletter, published posts on your intranet form employees who have bid and been accepted, announcements at your monthly stand ups
    • Adhered to- nothing is worse than putting a plan together, communicating it and then not following your own plan.  This means that EVERY position must be posted.  Nothing will derail your success faster than publishing some but all your positions
    • Promoted- find fun ways to promote the internal bid process- highlight the employees who have been successful.  Tie balloons to the cubes, hand out congratulations cupcakes.  Anything to bring attention to your program!
    • Tracked- ensure that you are tracking your metrics from the start and that you can report on your success.  Tracking your metrics will also tell you if certain teams are accepting more internal bids than others and allow you to focus your continued efforts in the right places

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The number one reason job seekers reported looking for new opportunities in one 2016 poll? Lack of advancement and promotional opportunities. Stated another way, what you don’t retain, you replace.

Recruiting is an expensive proposition no matter how you cut it.  In fact, almost 20% the dollars spent by an employer every year go toward the costs of recruiting and onboarding backfills.

So, well run internal bid programs not only make sense from an employee morale standout, but from a very real dollars and cents standpoint as well.

Doling Out Dollars

sherriesuski_dollarsIt’s merit increase time again.  “How hard can doling out dollars be?”, you think.  The budget is 3%, just give everyone on your team 3%, right?  Well, maybe, but let’s talk about a better way to evaluate and incentivize your team members.

Compensation is a blend of a science and an art.  Let’s talk about the science part first.  Done correctly, there should be salary ranges for your organization and sometimes multiple sets of salary ranges, depending on the physical locations in which you operate. These salary ranges should have been created by knowing your overall target market percentiles and the value of each job that you are slotting into your ranges in the market. It is often helpful to create a matrix for your managers to use when considering merit increases.  The performance rating should be on one axis and the quartile position in the salary range on the other axis. Keep in mind that the matrix is usually only a guideline.

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As employees move through their salary range, their salary growth should slow.  Someone who is performing at a 4 level, fully competent in their position, and in the 1st quartile, should receive a greater percentage increase than someone who is performing at the same level but is already in the 4th quartile.  Don’t be afraid to be open about this with your subordinates.  Compensation should not be a mystery.  Employees have a right to understand how their merit increase was calculated.  This can also open the door for conversations about career growth and additional responsibilities they could take on to move to the next salary grade.

Aside from merit increases, there are usually two additional types of increases that can happen.  One is a promotion, which is simple enough.  Someone is moving into a different position in a higher salary grade or is moving to a more senior position within their same job family.  The second type of increase is the market adjustment.  Perhaps the most misunderstood type of increase.  A market adjustment is not a way to give your employees more money without going over your merit budget, as many new managers believe.  A market adjustment is specifically used for an employee who is performing competently in their position, but is very low in their range.  Many organizations will restrict market adjustments to employees who are performing at a level 4 or 5 and are in the first quartile of their salary range.  This increase, in addition to the merit increase should bring the employee to the 2nd quartile or as high as the midpoint of the salary range.

The last topic is a merit increase that is called lump sum or one time merit increases.  There are pros and cons of implementing lump sum increases.  

These types of merit increase are reserved for employees performing at a level 4 or 5 and at the very top of their range.  The theory is you are already paying these employees above the 100th percentile of the market and do not want to continue to increase their base salary. You do, however, want to continue to reward and incentivize them.  If you decide to implement lump sums, they are usually given at about ½ the amount of a regular merit increase and paid all at one time at the beginning of the year.

So, now you know, doling out the dollars, can be a little more complicated than just giving everyone 3%, but, done correctly, you can continue to incentivize your best employees!

Stereotypical Startup Culture Can Be Detrimental – Part 1

startup culture

This is the era of the startup. Between the simultaneous unemployment crisis America has been experiencing in for the past few years, and the technological boom that is seemingly unstoppable, startups (primarily in the tech sector) have been popping up left and right. With this influx of startups came an entirely new culture: one of relaxed schedules, no dress codes, huge personal freedoms, and a never ending supply of snacks. The stereotypical startup is full of young, charismatic go-getters who thrive in a “fun” and “casual” workplace.

While this new culture and mindset have been hugely beneficial for some companies (see: Google and Facebook), it may not be the right move for all startups. There are a few ways that “startup culture” can actually do more harm than good for certain startup businesses.

 

Too Much Money is Being Spent

This is actually one of the biggest problems that many startups are facing. Everyone wants to emulate the Google culture, with the free food,  the games, and the chic & fun office space. But, the reality is that most startups cannot afford those overhead costs. Many companies will use a lot of the money from their investors to foster this fun space. While this will absolutely make a great impression on both employees and clients alike, it’s important to make sure that your company is saving money and focusing funds on creating a viable product/service.

 

The Lines Between Boss & Subordinate May Be Blurred

The beautiful part of startup culture is that it’s generally an environment of openness and personal connections. For a lot of companies, “culture fit” is important and people are hired based on how well they will get along with the existing employees. This creates a comfortable place of work and creativity, which is fantastic for productivity.

However, this wholly democratic environment may may lead to issues when hard decisions or conversations need to take place. If the bosses aren’t seen as leaders, and are instead seen as friends & peers, it makes it difficult to reign in a rowdy team, or to provide disciplinary action when an employee is out of line.


 

Be sure to check out the blog next month to learn more about the potential downfalls of the stereotypical startup culture.