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HR101 Recruiting & Staffing

Doug Merritt, CEO of Icarian, leans forward in his chair as he focuses intensely on the team’s ideas. Abundantly energetic, he smiles and launches passionately into the business opportunities ahead, into the central role of the people who work at his company.


He should know. Having started in 1998 with its first worker, Icarian now has 200-plus employees. These individuals, and the new ones to come, are constantly on Merritt’s mind. He is keenly aware that the growth, the very survival of his company, which creates workforce management software and service solutions, depends on its employees. He also knows that it takes creativity and dedication to staff an organization today.


Deloitte and Touche found a way to offer stock, but not stock options.


While it almost requires wizardry to create a work environment that attracts and retains workers in this high-tech mecca of Sunnyvale, California, Merritt’s challenges are the same ones faced by virtually all HR professionals confronted with a 4 percent unemployment rate.


“An organization can have all the right ideas and capital in the world, but without the right people to make things happen, it will fail,” states the Icarian Web site, broadcasting Merritt’s viewpoint to the world. But talk is cheap. And even the best talk these days is not nearly enough to garner and keep good talent. Best-of-class companies are moving beyond gimmicks and fast fixes to longer-term practices that require constant innovation and attention in order to staff their organizations.


Use inspired, easy-to-use recruiting methods


Ask Craig Collins, director of recruiting at New York-based DoubleClick, a rapid-growth global Internet advertising firm, how he handles the company’s enormous needs. He’ll tell you that DoubleClick’s largest source of new hires is its own employee base. Ranging around 30 percent in 1999, the company’s internal referrals were up to 43 percent in the first quarter of 2000.


“We set up a way for people who want to refer someone to go to the Web site and submit the referral right there. The resume gets captured, is sent to an administrator who looks at it and is able to distribute it to the appropriate recruiters,” says Collins. The capture system also records the employee’s name because whoever has the most referrals hired wins a prize. There are East Coast, West Coast, and international quarterly winners, and an annual winner who receives a Harley-Davidson motorcycle. Two motorcycles are displayed in the reception areas, with the words “Wanted: internal referrals — win prizes.”


Moreover, DoubleClick, known for its fast-paced, innovative corporate culture, streamlines the more traditional recruiting methods as well. The firm posts all jobs on the company’s intranet, as well as on Internet job boards.


The company also has a mechanism that allows a recruiter to click a button and access the vendor manager, who sends the posting to contingency search firms and other places, depending on the recruiter’s desires. The job description is posted on a recruiter management system that triggers a slew of postings, according to where the recruiter wants the listing to appear. For example, click the box that indicates Web site or intranet or vendor manager, and the postings are automatically relayed to the target location.


Think this is only for Web-savvy firms like DoubleClick? Not at all. While specific customizations may be in order, this service is offered by a variety of Internet referral companies that provide products to aid recruiters at their desktops.


Charles Schwab & Co., Inc., one of Fortune Magazine’s 100 Best Companies to Work For and recipient of the 2000 Catalyst Award, also boasts a 30 percent employee referral rate. Headquartered in San Francisco but located in various full-employment cities around the world, the company pays serious attention to being connected and recruiting from the local communities.


One event that the company promotes is a “Suitcase Social,” where workers bring in friends and introduce them to recruiters. There are raffles in which people win trips, thus the name. This event not only is an effective activity but also provides a chance to widely publicize the internal referral program throughout the organization.


The company also attracts intellectual capital through Workforce Development Programs. High school students who are interested in careers in the financial world can work at Schwab during the school year, not just during the summer. In addition, the firm has intern programs for high schoolers, undergrads, and graduate students.


“Think of it as a ladder, where we start out at high school and have programs that hit every level,” says Ruth Ross, vice president of human resources, policies, and practices. “It is a wonderful feeder pool for us, a great way for these kids to really learn a lot about business, and a great way to get them attracted and retained with Schwab, and we give them economic incentives to continue to come back and work for us.”


These incentives come in the form of bonuses and stocks, depending on the level and program. For example, there is one summer program in which people receive stock that vests if the individuals come back to work.


“We clearly have a goal of being a “best place to work,'” says Ross, “and our culture defines who we are and what makes Schwab such a great place to work.”


True enough. You can recruit all you like, but you have to have a place where people want to be. “A lot of times, you win or lose on the recruiting front based on the product you are selling,” says DoubleClick’s Collins. “In my case, I am fortunate enough to run a recruiting team that is selling a tremendous product. You have to take advantage of that fact.”


Create a corporate culture that sells itself


Knowing what’s important to workers is what sells them and keeps them. To some, it’s on-site child care or fitness centers; to others, it’s sabbaticals, flexible work arrangements, or training. To all, it is the collection of compensation, programs, and benefits that demonstrate that employees are valued. Again, these aren’t quick-and-dirty solutions.


“Given that human capital is our scarcest resource right now, making sure that you spend on people for their care and feeding makes a lot of sense,” says Merritt. “We are trying to build a good wholesome, well-balanced holistic corporate culture and still be highly successful in the business world.”


This philosophy underwrites the snacks, the drinks, the weekly masseuse and chiropractor available for employees; it generates the corporate culture that supports alternative work arrangements so that individuals who face grueling two- and three-hour commutes have the same kind of flexibility as people who need time for their families. It breeds innovation.


Employees receive “Icarian dollars” with each paycheck. Ranging from $50 to $200, this money can be used for anything that will enhance a feeling of personal responsibility to and connection with Icarian. The concept was initiated by senior management’s desire to empower individuals and to promote collaboration across departments. Employees have pooled dollars and spent their money for activities ranging from pool and skiing to funding charity events such as cancer marathons.


“The whole concept is that you have a personal responsibility to make this the kind of place where you want to work,” says Gretchen Allarcon, Icarian’s workforce operations manager (i.e., director of HR). “We want people to pool or save their money and spend it on whatever would make this place feel like a good place to be.”


The idea is taking hold. In June, some interns who were working at the company and staying in a hotel were robbed. In three days, employees raised almost $3,000 Icarian dollars to help replace their lost items and find them a better place to live. When a flood ravaged the hometown of an employee from India, Icarian workers sent money to help with reconstruction.


Schwab’s employees made a surprising choice–a benefit that cost the company less.


Another innovation is Web-based 360-degree performance reviews and feedback mechanisms. This format offers a collection of devices for continual review of people from above, around, and below. Instead of huge annual reviews, there will be more frequent (possibly monthly) reviews. This creates an ongoing dialogue, but with enough structure so that the information can be captured, sorted, and analyzed. Then, in this collaborative mode, management can also react to it more effectively. There are monthly “Dinners with Doug,” to which anyone is invited, as well as monthly group meetings with other company leaders.


Charles Schwab, which has a turnover rate of 12 percent (non-bank financial industry average is 15 percent and high tech is 19 percent), believes that one crucial aspect of continuing a healthy, productive corporate culture is to listen to employees. Annual surveys and frequent “pulse” polls offer management feedback about employee attitudes.


“When you open yourself up to listening to what people have to say, you’re really showing them that they have a voice in the company,” says Ross. Case in point: The firm was considering a subsidy program to offset the costs of transportation. There were two different ways to allow employees to end up with more money in their pockets.


One was to offer cash reimbursements; the other was a governmental program to put aside money on a pre-tax basis to offset transit costs for employees. The latter is far less costly to the company but gives employees a little less cash. Schwab took a vote of the employees. They voted for the pre-tax program. Why? Because, they said, they would still receive a benefit, but it was also better for the company.


Effective cultures engender retention


A corporate culture that sells itself also retains its talent. The best companies know that retention is what counts.


“In the final analysis, attracting good talent is insufficient,” says Jim Wall, national managing partner of human resources for Deloitte & Touche, LLC. What really counts is retaining people, he says.


Wall knows what he’s talking about. Boasting one of the first Optimas Awards, as well as the 1995 Catalyst Award, and top slots on the Fortune and Working Mother magazine “Best Places to Work” lists, Deloitte & Touche is renowned for its friendliness to women and dedication to retention.


“Retention is an outcome,” says Wall. “You get to retain the best people by providing the most challenging environment and the most supportive, compatible culture.” At Deloitte & Touche, training and compensation play a big role in demonstrating the value they place on individuals. “You actually get to keep your very best people by preparing them to leave you,” he says.


This paradox, he explains, goes directly to investing more money, time, and effort into career enhancement, mentoring, access to information, formal and informal learning programs, and all types of training to the very best people.


Creating a learning culture and an environment where people are intellectually stimulated is crucial when you are in a business that vies for intellect. “You’ve got to build the intellect and show the value of that intellect,” Wall says.


It requires compensating people well, and sometimes in creative ways. Deloitte & Touche is a partnership, not a publicly traded firm. Consequently, it cannot offer stock options. The firm will begin a new program in which certain employees (about 15,000 of the 25,000 workers) receive units they can invest in the stock market. While certain rules will prevail because of legal limitations in dealing with clients, the company will publish a list of funds that will be appropriate for portfolios.


For example, one employee might receive 10,000 units in 2000. In 2003, those units, which were invested, will have appreciated or not, and the employee will be vested. It allows individuals to participate in the firm’s success and gives them incentive to stay.


Staffing is one of the toughest, most complicated aspects of HR’s job today. Encompassing the full cycle of employee life, it goes to the heart of a company and determines the success — or failure — of the business.


“HR folks can’t do everything overnight, and expectations are very high,”warns Schwab’s Ross. “You want to plant seeds and watch them grow. In other words, it is about listening to your employees and responding to that. Are they satisfied? Is productivity going up? Do we have repeat business? Those are the kinds of really important messages we’ve learned.”

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At a Wisconsin Museum, Employees Feel Like Family

The Wustum Museum of Fine Arts didn’t start out as a museum at all. For its first eighty-five years, the Italianate farmhouse in Racine, Wisconsin, served as a private home. It wasn’t until 1941 that the house was converted into gallery space.


Yet even now, there’s a family feel among the people who work there. The kitchen serves as the nerve center, bring-your-dog-to-work day happens much more often than once a year, and every birthday prompts a celebration. The eight people who work there have even been known to call it “home.”


Talk about validation. Wustum Museum’s small group of staffers has 50,000 opportunities to see that their work makes a difference.


The fact is, they just don’t have time for formality and rules and protocol. The museum has six to eight exhibitions each year and a permanent collection and active education programs for children and adults. Nearly 50,000 people pass through each year.


The flexibility has allowed each staffer to find a niche. For Pat Kardas, it’s marketing and communications. But she’s quick to point out that she and her colleagues are constantly stepping back to look at the big picture. Weekly meetings help. They use the time to evaluate exhibits and sessions, to plan new ones, to figure out who does what as the week unfolds, and simply to touch base. It’s a lot like a healthy conversation around the dining room table.


With such a workload, what keeps them going? For Kardas, it’s all about reaching people. “We’ll have visitors who come in and say, ‘Wow, this exhibit is incredible!’ Or we’ll be working with children, watching them get so excited about creativity. We can see the joy on their faces.” Talk about validation. Wustum Museum’s small group of staffers has 50,000 opportunities to see that their work makes a difference.


According to museum director Bruce Pepich, the family of employees is now facing a tough question: How can their workplace remain flexible if the number of exhibits, visitors, and program participants continues its upward trend?


They’re taking a few measured steps, evaluating each as they go — simple stuff like using written agendas at their meetings. What’s clear is that this family won’t let bureaucracy move in anytime soon.


From the book “22 Keys to Creating a Meaningful Workplace.”


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Overtime Confusion Reigns in the Digital Age

The Fair Labor standards Act (FLSA) establishes minimum wage, overtime pay, child labor standards, and record keeping procedures, and applies to employees in both the public and private sectors.


While the Act regulates basic minimum wage, overtime pay, and the employment of minors, there are certain employment practices not affected by the FLSA. These include: vacation, holiday, severance, or sick pay; premium pay for holidays or weekends; and fringe benefits.


Overtime provisions of the FLSA


The most widely recognizable provision of the FLSA is its overtime provision. Generally, employers are required to pay overtime pay at a rate of not less than 1.5 times an employee’s regular hourly rate after an employee works 40 hours in a workweek. The provision protects all “nonexempt” employees not enumerated among the many exceptions to the Act.


Among the exceptions to the Act, the most frequently applied are the executive, the professional, and the administrative exceptions.


An employee who has supervisory authority over other employees and is paid a salary (that is, not on an hourly basis) is considered to be an executive. A professional employee is generally an individual whose work is based on an advanced degree, such as a lawyer or doctor. The administrative exception is relatively narrow, limited to the confidential secretaries of certain executive-level employees.


Individual employees who fall into one of these three exceptions are “exempt” from overtime calculations.


Problem areas under the Act


The problems faced by both employers and employees with respect to the FLSA fall into two broad categories: (1) the designation of employees as “exempt” or “nonexempt” based on job responsibilities, in this age of self-directed work groups and a growing force of white-collar technology workers; and (2) the determination and calculation of overtime hours, which has been complicated by telecommuting and on-line employment.


Designation of “exempt” vs. “nonexempt”


Many employers feel that the test for determining which employees are exempt from the overtime provisions of the FLSA are outdated, and should include more employees. They argue that technology has increased the number of exempt employees because it has created a class of workers who are more self-directed and are more often making decisions that affect company strategy, thereby falling into the executive or professional classifications.


Conversely, employees argue that the provisions of the Act are not broad enough to cover the growing high-tech workforce, and that many employers are misclassifying salaried employees in computer-related jobs as professional simply because the employees work at a desk or are responsible for their own work hours.


The Act’s provisions regulating exempt/nonexempt designations have been in place since 1954, and clearly have been outgrown by the modern workplace. In a report released in 1999, the General Accounting Office recommended that the Department of Labor, which administers and enforces the FLSA, should revise its regulations to more appropriately reflect the modern workplace.


Unfortunately, given the disparity in the positions advanced by labor advocates and management representatives, comprehensive changes will be slow to develop.


Calculation of overtime hours


The FLSA requires employers to keep records on hours worked for nonexempt employees, to assure appropriate payment for overtime work. One of the current areas of dissatisfaction with the FLSA is the lack of clear direction regarding records with respect to telecommuters, or other home-office based employees.


Without a consistent method for tracking hours worked by individuals based in locations other than company facilities, employers face liability for miscalculation or inadequate record-keeping, and employees face possible under-calculation of their overtime hours.


Under the FLSA, employees who are entitled to overtime pay must be compensated for overtime worked, even if the employer did not directly require that the work be done, so long as that employer knew or should have known that the work was being done.


For example, an employer was required to pay overtime and attorney fees where evidence indicated that the employer knew that a nonexempt employee had worked overtime, even though the employer denied direct knowledge of that overtime work. Cunningham v. Gibson Electric Co., 43 F. Supp. 965 (1999).


Checklist of basic FLSA issues


At a minimum, employers should be aware of the following issues:



1. An employer’s designation of an employee as “exempt” is not necessarily final, and may be subject to review by the Department of Labor if a formal complaint is made by the employee.


2. Once a salaried employee is designated as exempt from FLSA overtime provisions, the employer cannot deduct wages for absences (for tardiness or partial-day absence, for example). To do so could invalidate the employee’s exempt status.


3. Under the FLSA, the legal burden of recordkeeping falls to the employer. Employees should be instructed to report all time worked, including mealtimes if, in fact, an employee is required to work through lunch.


4. If training is required to fulfill job responsibilities, employers may be required to pay overtime if the training causes a nonexempt employee’s workweek to exceed 40 hours.


Employers are obligated to conform with the recordkeeping requirements of the Act. In order to avoid liability for FLSA recordkeeping violations, employers must inform employees of the importance of complete and contemporaneous time records, should be vigilant in confirming that such documentation is made and kept in the regular course of business.


Additionally, unless and until the FLSA is clarified and updated, employers must understand that not all knowledgeable and highly skilled employees are exempt from the Act. Designations should take into account the skills and training of the employee, along with a full assessment of the employee’s job responsibilities, wages, need for supervision, and any supervisory duties required in the position.


The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion.


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Macy’s Retention Strategies

The following are programs Macy’s has in place, aimed at increasing retention of Associates:


  • New hire training program: six hours.
  • New hire paired with a Team Angel (experienced associate) for mentoring.
  • New hire survey mailed to associate’s home after 30 days.
  • Sunday School: On Sunday, 1 p.m. to 2 p.m., associates on lunch break can attend programs on how to become more successful at Macy’s.
  • Specialist of the month/specialist of the year award programs, with an “Oscars” awards ceremony each April.
  • Star Council: volunteer committee of managers and associates that develops events to benefit community groups and employees.

 


Programs aimed at retaining store executives:


  • “Lights, Camera, Action” program to orient and develop new store executives for the first three months of their job.
  • Group sales manager development on alternate Thursdays, such as a coaching and counseling class.

SOURCE: Macy’s West


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2000 Service Optimas Award Profile QUALCOMM

QUALCOMM


Real HR: As a manufacturer of cellular telephones, QUALCOMM competes in a rapidly changing business environment.


Cellular service providers offer new options, competitors add new features to phones, and consumers have become more sophisticated.


Therefore, QUALCOMM must be able to create and produce products at least as advanced as what competitors produce, and ideally more advanced.


In addition, the company has been through dramatic change: three acquisitions, a joint venture with Microsoft, the sale of one division and pending sale of another, the opening of a first international facility and more.


Through it all, the company also has been growing at an exponential rate. The company often hires 100-150 people per week.


Providing classroom-style training for those people proved logistically challenging and cost prohibitive, yet without the training, the company stood little chance of staying competitive. HR used Intranet technology to solve the problem.


Real Impact: Today, QUALCOMM offers more than 45 professional development training modules and numerous skills development courses online.


The training is available 24 hours a day, seven days a week so that employees can learn at their own pace regardless of their work schedules.


Employees also can use the Intranet to sign up for classroom training when its offered, find other learning resources (such as books and videos), and find just-in-time job aids.


In addition, the company has teamed with the University of Southern California to offer an on-site Masters in Electrical Engineering program, and with San Diego State University to offer an on-site MBA program.


To ensure that the course content for all training supports business goals, Learning Specialists are assigned to each business unit. These specialists sit in on staff meetings, meet regularly with managers, and conduct needs assessments. New training courses are created as needed, or existing courses are modified.

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2000 Competitive Advantage Optimas Award Profile Jamba Juice

Jamba Juice


Real HR: Jamba Juice sells fruit smoothies and soup, but the chain competes with other fast food outlets for managerial talent.


How can the company attract and retain the best in an industry known for low wages and high turnover?


Real Impact: HR has driven heavy investment in its employees. The investment starts with an intensive five-week training program for managers. A compensation strategy rewards managers for developing employees and for staying with Jamba, and profit sharing encourages them to think like managers.


Line employees are rewarded with generous benefit packages. These HR strategies are paying off: Sales increased more than 4000% from 1993 to 1997.


Jamba has become the national leader in its product category with more than 250 stores in 15 states. Its most loyal customers frequent the stores about 16 times a month, which is unheard of in fast food.

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Getting Started With a Community Service Program

Want to see what interest your management and employees have in developing a Community Service Program (CSP)? Here are some ideas to help you get started:


  • Form a broad-based committee to select designated charitable organizations, special events and/or civic activities based on interests of employees and compatibility with business image and/or products.


  • Make individual action one component of the CSP (e.g. fun-runs, meal service, volunteer readers, pro-bono professional services). Employees find this level of service personally rewarding and, at the same time, they can get to know co-workers involved in the same project in a much different context than their day-to-day work roles.


  • Include donations as one way to participate (toys, books, money, etc). Set-up a “tribute” program for your favorite charity. It is a great device for HR Managers and other busy business professionals to acknowledge staff and clients on a personal level. Make sure a tribute card (appropriate to the occasion) is sent on a timely basis to the recipient. It need not specify the amount donated.


  • Scholarship programs can be started to support career development within the workforce, higher education among the children of staff, or to support the community at large based on desired goals. Scholarship administration can be outsourced.


  • Internally initiated projects are often the most heartfelt and meaningful. A CSP program should make room for efforts close-to-home. At the Southern California law firm of Stutz, Gallagher, Artiano, Shinoff & Holtz, the staff had been discussing participating in some type of community service when a single mother, employed with the firm just six months, learned her very young son had a cancerous brain tumor.


    Her co-workers rallied by taking care of all meals for the family daily over the next two months, cooking and making deliveries in shifts. Cash donations and toys were delivered to the hospital, and emotional support was extended by every level of staff at the firm as this young family coped with one of life’s toughest challenges.

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2000 Vision Optimas Award Profile GTE

GTE


Real HR: To help keep competitive, GTE worked to integrate its HR strategies with overall business objectives. The goal, simply, was to make sure that HR was helping move the business forward.


To do that, HR efforts were focused on five key areas: managing talent, developing world-class leadership, customer service and support, organizational integration, and HR capabilities.


Although the concept sounds good, HR further challenged itself to find a way to measure the effectiveness of its efforts.


Real Impact: The result is the GTE HR Balanced Scorecard. The scorecard was developed to assess whether HR strategies were actually being implemented and, if so, whether they were helping the business.


The scorecard is unusual in that reports on both leading and lagging indicators, and it is the first to be used with such depth throughout an HR organization. The scorecard captures more than 700 metrics in three categories: volume and activity of the HR function, service level measures and strategic measures.


The results are shared throughout the organization. A pay for performance plan for HR professionals has been tied to the metrics. The scorecard helps HR to identify issues before they become problems. It also has helped boost HR’s credibility.


But the greatest benefit may be that it has helped change the GTE culture from one in which each function worked in a silo to one in which information is shared across functions to improve productivity.

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Prepare Employees for Their Next Job and They’ll Stick Around

A lot of our conversations these days focus on recruitment and retention issues. Its probably true with you as well. They go something like this:


“When are we gonna get the jobs in ___ filled? There just aren’t any good applicants anymore. What’s the matter with these Generation Y kids? I just can’t compete with those dot-coms. Why in the world do we keep losing good people?”


Invariably, the loudest, highest-pitched noises emanate from those who still view recruiting as the exclusive domain of HR, or have yet to realize that one’s reputation as an employer is as important as bandwidth. We’ve got some advice for those folks, and by all means invoke our names when you pass it along: Stop whining!


Yes, finding and keeping the right people is, for many, today’s central business challenge. While few escape the problem, no one loses more sleep over it than those in the retail, food service, and hospitality sectors.


The National Restaurant Association suggests that “finding qualified, motivated labor is the biggest challenge restaurant operators face today.” In a sad commentary on the “motivated and qualified” part, one fast-food operator recently made this appeal for warm DNA on its marquee: “Now Hiring Faces. Smiles Preferred but Not Required.” With turnover of fast-food workers approximating 300 percent, by the time you get your fries, the person who took your order may already have initiated a career change!


A recent article in HR News described the dilemma of Florida companies trying to recruit hospitality workers in the face of a 2.8 percent unemployment rate. The article described creative (more like desperate) steps being taken by some of the biggest names in hospitality to ensure that breakfasts are cooked and served, beds made, and park sidewalks swept. Disney has reportedly resorted to making recruiting trips to Puerto Rico, dangling airline tickets and sizable recruiting bonuses in the faces of those willing to sign on for a year’s stint as a maid or food-service worker.


In the war for talent, it is all too easy to become blinded by fads and low-hanging fruit, thus ignoring two simple truths that are the real critical success factors in this equation:


1. Retention begins with recruitment, and


2. Your people practices matter — a lot.


Hire for Fit


The most successful enterprises are careful to hire people who are competent, of course, but first and foremost, they hire people who fit the organization by virtue of style, values, and work preferences. They realize that these folks will be happier, more productive, more successful, and just might stick around longer. Talent is important, but to them, finding people who fit the organization is mission-critical.


All of Marriott’s 143,000 employees have one thing in common. They are unfailingly polite. If they’ve got any surly employees, they’re hiding them in the basement. Maybe rule No. 9 of CEO Bill Marriott’s 12 Rules for Success — “It’s more important to hire people with the right qualities than with specific experience” — has something to do with that.


Chick-fil-A, the fast-growing, Atlanta-based, “Eat More Chicken” chain, takes a similar path. Founder and CEO Truett Cathy’s decision to place someone in a position of leadership can ultimately rest on a single consideration: “Would I like my son or daughter to work for this person?” Does it work? Well, how would you like a turnover rate that approximates one-fifth of the industry average?


Maintain Outrageously High Standards


Loosened work standards often provide the first visible clue to your better performers that they are no longer part of an elite, winning team. These folks, the ones you really want to retain, have a serious dislike for losing organizations and don’t want to hang around with losers.


We heard recently from an operations manager with a major California-based casual dining chain. It seems that about a quarter of the 100 or so employees in one of its stores had just been caught confusing the restaurant’s money with their own. The GM’s response was — get this — to let them off with a verbal warning, on the premise that “if we terminate them, we won’t be able to keep the doors open.” We’re told that several of the restaurant’s better producers immediately opted to vote with their feet, muttering something about not wanting to work with thieves and losers.


Forget the Fads — Get Serious


In a retention effort running a mile wide and an inch deep, some companies have a penchant for every fad-of-the week program. They have Friday afternoon beer busts, allow employees to bring their pets to work, and call everyone an “associate,” but when it comes to dealing with managers who run roughshod over people, or eliminating ridiculous policies that sap morale, their knees buckle.


Let’s be clear about something. People don’t leave organizations. They leave managers who continually fail them in some important respect. They leave jobs that bore them. With regard to the former, we’d suggest you start dealing with the people that General Electric labeled “Type 4” managers in its 1995 annual report. You know the ones. They manage to generate pretty decent short-term results, but do it by grinding people down. Either coach them to acceptable levels of behavior, or help them find other jobs — preferably with a competitor.


Give People Their Work Back


People want suitable challenges and the freedom to pursue them. In an attempt to broaden responsibility, authority, and accountability, Marriott introduced its “First 10” program, in which the person greeting you at the door also handles check-in, helps with your luggage, and escorts you to your room. Aside from being pretty neat from a guest’s standpoint, it provides more variety in the employee’s work, not to mention a clear signal that the company believes it hired more than just a strong back. And it doesn’t stop there.


Recently, we conducted a leadership seminar at a Marriott hotel near Dulles Airport. About 90 minutes before the seminar, we visited the meeting room. To our dismay, several things about the room set-up were wrong, including an absence of critical audiovisual equipment. (It was our fault, not the hotel’s.)


We began looking for a banquet coordinator-type person to help with our predicament. There was exactly one human in view: a lady from the wait staff busily putting out coffee and breakfast rolls. She immediately noticed us and asked if she could help. We spouted out the problem, not really expecting much in return.


With a look and a voice that suggested she meant business, she said: “No problem. It will be taken care of before you get back.” She handed each of us a business card imprinted with her name and job title, banquet server. She did get our situation resolved as promised, and later in the day we asked our new friend, Annie, how a banquet server came to get involved with AV equipment and the like. With obvious pride, she replied “These meeting rooms are my responsibility and I make sure my customers have what they need.” Wow, put that in a bottle!


Balanced “Worth Its”


At the end of the day, people expect to see personal interest and an investment in them commensurate with the effort you’re expecting them to put forth. It often comes down to simple stuff. A manager at Crate & Barrel has been known to tie a pair of theater tickets to the handle of a broom, for the benefit of the first person to pick up the thing and use it. Part-timers at Starbucks get benefits just like “real” employees. Employees at Marriott and Chick-fil-A get opportunities that can be bigger than their resumes.


Will some of these things better prepare people to leave you? Yes. But then again, they just might make them more eager to stay.

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2000 Financial Impact Optimas Award Profile IBM

IBM

Real HR: Not long ago, IBM was huge, wildly profitable, and a product leader.


But all that changed when Big Blue misjudged the developing PC market. In a period of just two years (1991-93), IBM moved from a $6 billion profit to an $8 billion loss. The stock price fell from $123 a share to just $42. And 80,000 employees were laid off.


The company had to reinvent itself or disappear. At the time the company foundered, HR itself was bureaucratic and bloated.


In response, HR consolidated operations and trimmed its own workforce from 3,400 to approximately 2,000. It was not enough.


The restructuring did not address all the problems facing HR: a large and costly base of experts, ineffective technology, and a lack of well-defined processes. In 1994, HR was challenged to slash costs another 40-50%.


Real Impact: In January 1995, HR opened the National Human Resource Service Center in North Carolina.


The call center consolidated HR operations while optimizing self-service and establishing a tiered service delivery system that allowed experts to deal only with the most complex issues.


Since its inception, the center has processed more than seven million calls. In 1994-95, the HR team cut costs 40%. In each subsequent year, the number of HR subjects supported and customer requests have increased while costs have continued to be reduced.


Today, the center supports more than 700,000 customers and handles more than seven million transactions annually.