The 3-Part Equation for Developing Managers

Hiring good managers is a difficult process. Managers are the key link between executives and employees so they need to be versatile. They must also be able to balance strategic planning skills with operational skills. But finding the right manager is only part of your work. You are also responsible for developing your managers. Good managers are talented but they are not perfect. An organization grows and develops over time and your managers must grow with it. Developing your managers is a necessity.

Developing managers is a unique task because it involves a hybrid approach. Managers need sharp leadership skills and solid communication skills for day-to-day interactions. Finding the best way to develop your management team can seem overwhelming but a good starting point can be summarized using a simple equation:

Leadership development + Engaging managers + Collaborative environment= Managerial development 

Leadership skills are a critical part of managerial development. A survey conducted by the Society for Human Resource Management (SHRM) named developing leaders the second most pressing problem facing HR over the next 10 years. Forbes contributor Meghan M. Biro said that the “best employees are leaders,” in her article covering the SHRM study. Managers should be your top employees and you want to invest in developing and sharpening their leadership skills. Biro advised executives and HR professionals in charge of leadership development to avoid making leadership an “advanced training in PowerPoint.” Leadership development should immerse your managers in in a leadership environment. This can be accomplished through a leadership development program.

Next, add in engagement. Developing managers involves empowering them by engaging them. Starbucks offers a great model for this style of empowerment (Read More: 4 Tips for Increasing Employee Engagement from Starbucks). Starbucks sees each of its store managers as mini-CEO’s who run their own businesses. The company allows store managers the freedom to give each store its own vibe. This does not mean, however, that the stores function as entities completely separate from the Starbucks mission. At Starbucks Leadership Lab conference, Starbucks executives help store managers understand how their work fits into the overall company mission. The key takeaway from Starbucks is the company’s perfect balance between micro-management and a completely hands-off approach. The sweet spot in the middle is how you engage your managers through empowering them. Managers must feel empowered enough to make decisions without checking in every five minutes. They also need to understand how their work fits into the bigger picture.

The last factor to add into the equation is a collaborative environment. Collaboration does not come naturally. It is human nature to want your idea to prevail. This human tendency leads to arguments if managers do not know how to control it. Teach your managers how to compromise and encourage openness instead of hostility when there are disagreements. Collaboration is a natural outgrowth of compromise. Charalambos A. Vlachoutsicos, a former manager and current economics professor at Athens University in Greece, discovered this method early in his career. He stopped trying to get a warehouse manager to agree with him over stock out issues and used a bonus system to get him to get on board with a plan to decrease the number of stock outs. A “do what I say because I am in charge” management style is ineffective. The key to collaboration is understanding. Help your managers understand that they are not always right. Help them understand that they will have to compromise.

Developing managers involves a wide range of training. The investment is steep, but the payoff of a manager who leads, stays engaged and collaborates is huge.

Posted on Workplace 101 Blog

4 Tips for Increasing Employee Engagement from Starbucks

Effective customer service starts from within an organization. Successful companies see their employees as more than just workers but also brand ambassadors. A company's efforts to boost employee engagement should translate into effective and strong customer service.

Starbucks cares so much about boosting customer service from within that they spent $35 million to send 9,600 store managers to their Leadership Lab conference and exhibition. The 400,000-square-foot facility developed over a three-week-long process that included the installation of 21 projection screens and 5,000 live coffee plants. The goal was “to mobilize [Starbucks] employees to be brand evangelists.”
We can use Starbucks’ methods in developing their Leadership Lab to see how team building can lead to better customer service.

1. Treat each store like a small businessStarbucks views their managers as global employees who “essentially run $1 million+ small businesses.” They recognize the local niche of each store but also look for ways to make company culture cohesive, even across diverse markets. This means finding ways to connect over 18,000 stores worldwide without losing touch with each store’s individual problems. At the Leadership Lab, managers shared problems they were facing in their individual stores but they also connected with each other over stories of customer shoe types.
Universal themes, such as customers shoe choices, had different expressions in various stores. These methods help build a unified brand that retains the individual character of each store. Starbucks employees can connect on what makes the brand unique while also keeping each store unique.

2. Make employees feel like part of the larger missionCEO Howard Schultz knows that the Starbucks brand is nothing without its baristas. He focused the Leadership Lab on giving employees “reasons to believe in their work and that they’re part of a larger mission.” An employee with a connection to the work of the company will then operate for its good just like a personal matter. Making the work of the company applicable to each employee’s work inspires a commitment that can’t be bought. For Starbucks, this included giving employees an opportunity to learn more about bean harvesting by raking real coffee beans.
Starbucks sells the concept of the brand to their employees first to equip them in selling to customers. This ensures they have a personal investment in the company’s development. Story telling helps make store experiences more personal. Valence O’Neil, Starbucks’ VP of global communications, told Fast Company making the coffeeshop experience part of an inspirational journey means “partners can walk away not only understanding and informed, but feeling it.” When your employees believe in your company on a personal level, they will want to pursue its success out of self-interest.

3. Be creative with training sessionsDistinctive to the exhibition of Starbucks’ Leadership Lab is that it “feels more like a Starbucks theme park” than a conference center. Its 20 exhibits uses a two-hour theatrical experience to engage attendees. The production was “like being immersed in a Starbucks commercial.” Making training fun gives employees a reason to care. Creative experiences help the training to stick long after the production ends.
Other companies have also used immersion experiences and unique methods to boost employee engagement during training. General Mills offers a leadership course that combines meditation, yoga and dialogue. General Electric spends about $1 billion annually on programs at their corporate university.
The Leadership Lab combined leadership training with a trade show in a way that fit Starbucks’ corporate culture. Part of the power of effective storytelling is in fitting the training to the brand. Not all companies are alike so their training should also vary.

4. Develop a mission statement that mattersThe final exhibit in the Leadership Lab experience gave employees a chance to reflect on the mission statement of Starbucks:  “To inspire and nurture the human spirit—one person, one cup and one neighborhood at a time.” Starbucks invoked the power of its mission statement to turn around struggling sales figures a few years ago.

Starbucks invested $30 million in a similar exhibit in 2008 that focused solely on the mission statement. After that conference, Starbucks turned shares that “had lost 42% of their value the year before” into 11 consecutive quarters of record earnings, revenue or both. The mission statement became more than just a clever-sounding phrase. It transformed into a call to action that employees could implement in their stores.
A deeper understanding of the brand helped Starbucks employees engage with their company. Running a small business within a global brand gives managers feelings of autonomy without disconnectedness. Effective employee engagement means that employees transition from workers who clock in everyday to brand ambassadors who incorporate the company's mission into their daily work.

Posted on Workplace 101 Blog

Case study: Communication, small perks kept our best people on board

The recession that began in 2007 was the worst economic downturn our country has seen since the Great Depression. Family-owned business Humtown Products was hit on all sides. The company saw its industry’s profits as a whole drop 65 percent. The company’s customers were going out of business left and right. Humtown was forced to lay off the majority of its workforce and went from 200 employees to 20 employees in two months.

“[It was like] hitting an iceberg,” said Mark Lamoncha, CEO of Humtown, “taking on water and sinking.”
Humtown Products got its start in 1959. Mark’s father, Russell Lamoncha, started the business out of frustration while working for an employer who Russell felt had poor labor practices. The company began as a pattern shop for machine parts. Mark and his brother Criss both began working in the family business at age 12. In 1977, the company began producing sand cores and molds that foundries use when casting parts in metal. Today, Humtown Products calls a 44,000 square-foot plant in Columbiana, Ohio, home. The company still specializes in producing patterns and sand molds.

Mark believes in human capital as a catalyst for company success. He sees himself as the coach of a team and views the workplace as a sporting event. After the economic downturn, Lamoncha was hungry for ideas about how to turn the company around. Lamoncha got the idea for paying his employees based on performance through careful studies of incentive plans at other companies. He liked the idea but saw that other companies were not implementing the program consistently. “They were good, but they came once a year. We needed instant gratification,” he said.

Lamoncha got to work creating a “Real Time Pay Rate” system. The result of his work was a computer system that shows employees how much they make each hour based on how much they produce. If an employee produces 10 parts per hour, he or she makes $10 per hour. If an employee produces 20 parts per hour, he or she makes $20 per hour. It is simple but has proven to be effective. As a result of the program, teams show a consistent interest in finding ways to increase their productivity.

Lamoncha wanted to couple his pay rate system with a method for determining job-fit. He met a Profiles International business partner in 2001 who introduced him to Profiles’ assessments. He decided to implement the ProfileXT® and Profiles Performance Indicator™.  Every candidate for a job at Humtown must take the ProfileXT®. The company values the assessment for its ability to create patterns that help identify possible successful employees. Lamoncha uses the assessment scores to determine which candidates to bring in for interviews. The Profiles Performance Indicator™ has been useful in helping Lamoncha coach employees and build effective teams.

“The Profile made an enormous difference in our efficiency by helping us find the right people for the job,” Lamoncha said. The combination of Lamoncha’s pay rate system and Profiles International’s assessments has been astounding. The employee production rate has increased more than 300 percent. Increased productivity allowed Lamoncha to lower prices more than 70 percent and still maintain the same profit margin. Lamoncha provides Humtown employees with paid health insurance and long-term disability insurance. Despite his generous benefits, insurance costs are only 1.46 percent of the cost of goods sold thanks to the increased productivity of Humtown employees. Job-seekers flock to Humtown because of the company’s reputation as a generous employer.

Lamoncha’s pay incentives and Profiles International’s assessments were just what Humtown needed to get the company back on track. The success of the company since the changes is a testament to the importance of hiring the right people and giving them the motivation to work hard.

Originally posted on Workplace 101 Blog

The World’s Worst Advice for Keeping Employees Happy at Work

Sometimes it feels like robots rule the world. If a computer can do it, a computer will do it. Companies have downsized with the help of technology and some jobs are now all but obsolete. So what happens to the humans who remain? Some jobs can never be replaced. Does our technologically advanced society demand that humans working with machines become like robots too? The world’s worst advice for staying happy at work might encourage you to give up on your humanity and follow the “if you can’t beat ‘em, join ‘em” mentality.

Effective managers know that it’s important to get humanity back into business. When it comes to boosting employee attitudes and encouraging employee motivation, here are three blunders they know to avoid:

1. Treating your employees like robots
Impersonal leadership is a dangerous game. Keeping a cold distance from your employees can actually make them feel like “hostages at work,” according to an HBR blog on leadership. People need a secure base for comfort and energy. If you want to boost employee motivation, ease their anxieties. Effective managers don’t have to become paternalistic caregivers, but they should work to develop attachments at work.
Every enterprise or organization will likely face some levels of unexpected stress. You want to be able to work together as a team with your employees when that time comes. Build relationships now to keep employee attitudes high even when their environment becomes hostile or difficult. Your employees should be able to trust you. If you want them to have faith in your leadership capabilities, they need to have faith in you.

2. Never asking for help or relinquishing power
It’s natural to want to assume the role of the fearless leader. As someone in a position of authority, you might be afraid to fail. However, tucking your pride away can help your employees feel more valuable. According to a TribeHR Blog, “desperation is the perfect time to recognize how much you value your employees’ skills and contributions.” It is in these weak moments that your team can come together to build an even better company. Boost morale and employee attitudes by thanking your employees for their contributions. When they see that they are important to the success of your organization, they will be more eager to help out in the future.
Being generous with power also helps build employee trust. It shows that you care about what your staff is doing or not doing. Sharing power also mean sharing the responsibility for dealing with the consequences, according to a Fast Company article by Erika Andersen. This is not a path for lazy managers. You will have to communicate more with your employees by providing continuous feedback. However, the payoff is huge. “Generous leadership makes people feel capable, included, and motivated to succeed,” Andersen wrote. Effective managers want to empower their employees.

3. Trying to catch people screwing up
Are you the boss who always notices when something goes wrong? Forgetting your employees’ daily successes can create a hostile work environment. Instead of relentless fault-finding missions, celebrate small acts of kindness. An HBR Blog on catching people doing things right argues that kindness and compassion are what reminds us to be human in the midst of our technology-driven world. Providing employees with constructive feedback and praising their small successes can go a long way in keeping people happy at work. For example, TD Bank stays human-centered by rewarding employees with stickers every time a manager or officer catches them living up to the company’s principles of great services. As the card fills with stickers, employees become eligible for prizes.

Looking for the positive can help keep humanity in your workplace. Robots don’t care about feelings or attitudes. Your employees are not robots. You must remember to treat them like humans if you want to build strong relationships for successful team efforts.

Posted by Sally Ann Moyer on Workplace 101