Category: Archive

Do you want to offer your employees better benefits, but don’t think you can afford it? Think again. Today, you really can’t afford not to take special care of your workers. If they don’t get the preventative health care they need, your company pays big when they get ill. If they don’t get time off for personal or family problems, their productivity suffers. And if they don’t gain satisfaction from their jobs, they leave—costing your company in turnover, recruitment and training.

This is a lesson the Calvert Group learned well. Not long ago, turnover at this Bethesda, Maryland-based mutual funds company was at 30%. Although this wasn’t exceedingly high for the industry, it didn’t sit well with Calvert executives. The turnover rate indicated that employees weren’t happy with the quality of their life at Calvert. And this was a company respected for its dedication to quality of life. Indeed, Calvert pioneered the concept of socially responsible investing as a way to ensure a better quality of life for all. The Calvert Social Investment Fund, for example, seeks to invest in companies that have good environmental practices, make safe products and treat their employees well. Conversely, it avoids investments in companies that pollute, make unsafe products or have poor labor relations.

“Our overall mission is to be a primary provider of asset management while at the same time improving the quality of life in society,” says Clifton “Stan” Sorrell, president and CEO of Calvert. “And for us, society means our employees, our shareholders and the community. Both our products and our people must be in sync.”

To bring these elements into alignment, the HR staff at Calvert began to look at its employees holistically and refocus the company’s benefits and HR policies accordingly. “There are a variety of different needs we all have as human beings,” says Evelyne Steward, vice president of human resources. “We all have survival needs, psychological needs, emotional needs and spiritual needs.”

Calvert thus structured its benefits and HR programs around these human needs. The company now addresses survival needs with compensation programs and health and wellness programs that cater to individual needs. It attempts to satisfy emotional needs by creating an environment of trust in which people are treated with respect and dignity. It provides growth and development initiatives to help employees fulfill psychological needs. And it provides opportunity to do meaningful work both within the office and in the community as a way for workers to achieve some spiritual satisfaction (see “Calvert Group Fulfills Workers’ Basic Needs,”).

Says Training Manager Bill Williams: “Although Calvert isn’t publicly traded, we strive to be the kind of organization that, if we were publicly traded, we would pass our socially responsible screens.”

The holistic approach has paid off for Calvert. Yes, its benefits package is immense, with some benefits carrying a hefty price tag. But the company also offers many benefits that cost it little or nothing, such as flextime and a dress-as-you-like policy. In return, Calvert gets increased loyalty, high production rates and low turnover—currently at approximately 5%—all of which translate into increased profitability. “If people have their needs taken care of, they can be more relaxed, and they can get more enjoyment out of their work,” Sorrell says. “And, more motivated people are going to be more productive people. More productive people are going to make the company a better organization and a more profitable organization.”

Still think you can’t afford to up the ante for your workers? Read on and see how Calvert does it. By the way, Calvert only employs approximately 150 employees, its human resources staff only numbers four and, as a privately owned small company, its revenues are a far cry from those of Fortune 500 firms.

Here’s what Calvert has to offer.
Calvert’s benefits plan isn’t static. It’s altered frequently to keep pace with the changing needs of its work force. Constant communications and occasional formal focus groups keep HR abreast of employee needs. Through these dialogues, Calvert has learned a key point: When it comes to benefits, one size doesn’t fit all. Although all workers have needs that fit into the four basic categories, these needs can vary dramatically. To an older worker nearing retirement, health care and retirement savings are the biggest concerns. For a young parent, child care and time off for emergencies top the list. And for a young, single worker, getting a college degree may be the most important need to fulfill.

That’s why Calvert offers flex-benefits under a package it calls Personal Choices. Benefits are grouped into one of three categories in the package: core benefits, optional benefits, and other benefits and services. The core benefits are such things as life insurance, sick leave, disability, holiday pay and a retirement savings plan. These are company-paid benefits that employees receive automatically upon date of hire.

Optional benefits include medical, dental and vision coverage, spending accounts for health and dependent care, additional life and disability coverages, and additional savings plans. Optional benefits have a cost for employees, but can be paid for with pre-tax payroll deductions and with ChoiceBucks—money Calvert gives employees each year for their benefits based on their age, years of employment and annual salary. The key for keeping costs down, says Steward, is letting employees choose what they need rather than spending money on things they don’t need.

Although the optional benefits, as the name implies, give employees flexibility as to how much medical or life insurance coverage they want and what type of policies suit their needs best (for example, there are five different health-care plans employees can choose from), it’s the benefits and services in the “other” category that give employees the greatest choices for tailor-making their plans.

Lumped under this category are such things as career planning, an EAP, transportation/parking benefits, tuition reimbursement, free weekly massages and a multitude of family-friendly services. Most of these are company paid. A look at the transportation/parking benefits will show how it isn’t a one-for-all proposition. For example, the company pays for employees’ parking. But because it encourages workers to use public transportation, it also covers the costs of bus and subway fares, even if these total more than the parking fees. And in addition, Calvert will reimburse employees who walk to work up to $120 per employment year for walking shoes, and will buy employees who bike to work a new bicycle with a maximum cost of $350, each year. “Even if someone asks for a new bicycle every year, it’s cheaper for us than $80 a month for parking,” says Steward.

Educational assistance and a physical-fitness reimbursement policy further illustrate the flexibility given to employees. Calvert will pay as much as $3,000 a year for classes employees take, be they for learning how to basket weave or for earning an advanced degree. “We want people to be committed to learning,” Steward says.

The same goes for physical fitness. Calvert reimburses workers up to $35 a month for health-club memberships, tennis courses or whatever. “One guy was a member of a rugby team, and would come in black and blue every Monday during rugby season,” says Judy Shober, an HR administrator. “I used to think, ‘this is a benefit? We’re helping this person get bruised.'” But, in accordance with the philosophy of matching benefits to lifestyle, the company doesn’t limit workers’ choices of sport, other than to stipulate that the activities must be organized.

Calvert’s mix of family-friendly policies is another example of its commitment to meeting its employees’ varying needs. It pays for up to 80% of the cost of adoption, up to $2,000 per adoption, or reimburses for out-of-pocket expenses beyond deductibles associated with alternative birthing arrangements, such as hiring a midwife. It offers a domestic partner health-care subsidy for homosexual employees who can’t receive the coverage in the regular health plans. And it offers flextime, job sharing and telecommuting for employees who have special needs.

It’s these types of benefits that have fostered Carmen Ieid’s loyalty to Calvert. Pregnant with twins four years ago, the sales and marketing administrator was instructed by her doctor not to commute for the month prior to her due date. So Calvert installed all the equipment she needed in her home so she could continue working for as long as she felt able to. After the birth, she needed more time off than she had anticipated to care for one of the newborn’s health problems. In total, she received eight paid weeks off (this included paternity leave since her husband doesn’t work at the company).

After returning to work, Ieid took advantage of the flextime benefit for quite a while, working four days a week and using Fridays to take the twins to doctor’s appointments and so forth. “That all meant so much to me,” says Ieid.

For Shober in HR, who has a disabled daughter, a flexible schedule is what enabled her to start her career with Calvert. And that was 13 years ago, long before flextime was part of the benefits vocabulary. “I’m living proof [of the effect on the company] the benefits here have,” Shober says. “Calvert worked around my schedule, and I’m still here all this time later.” Shober, with Steward, has been a key player in designing the benefits program.

Calvert cultivates careers and healthy communities.
Having loyal employees such as Ieid and Shober certainly has its advantages. But it also creates problems in a small company—especially one that strives to fulfill workers’ psychological needs by offering employees challenging careers. “Some people get to a point at which they feel there’s no-where else for them to go,” Steward says.

Indeed, survey information Calvert gathered a few years back indicated that other than leaving because of personal reasons, such as relocating or going back to school, the single biggest reason why people left was because they felt they’d reached their maximum potential at Calvert, and sought more opportunity.

Calvert has a strong promote-from-within policy and posts all open positions internally before recruiting from the outside. And to prepare people for filling these positions, Calvert offers support. It encourages workers to create their own personal development plans, and some managers actually require their employees to set career goals that they review with the employee periodically. Workers who seek it can receive career counseling from human resources. “We do a lot of one-on-one, helping employees focus on where they want to go and what they need to do to get there,” Shober says.

And workers have many resources available to them. Williams maintains a training center that’s stocked with books and videotapes on subjects ranging from successful investment strategies to how to write an effective, attention-getting resume. Workers can check these items out on their honor. The center also provides computers for computer-based training courses on such programs as Microsoft Word or Lotus 1-2-3.

Other resources available include assessment tools and informational interviews. Occasionally, the company also brings in career counselors who conduct training seminars on how to determine an employee’s best career route.

Despite all of this, Shober says it’s inevitable in a small company for people to outgrow it. “As people grow, their needs change,” she says. “We hope there’s something at Calvert they can grow into. But if they grow out of Calvert, that’s OK too, because we feel we’ve given them a good, strong background to take with them.”

A little bit of turnover is good anyway—it enables companies to bring in new blood. For Calvert, these new hires have to be more than warm bodies. Not only must they meet job requirements, they need to be people who “really want to make a difference and who can be committed to our quality of life mission and our social responsibility,” Shober says.

When screening applicants, Shober listens carefully to candidates’ responses and questions to determine whether they’re good fits. And although having done community service isn’t a prerequisite for working at Calvert, people who have been involved with their community tend to fit best with the Calvert culture.

After all, community involvement is a big part of Calvert’s culture. The company gives all employees a total of 12 days off a year for community service. This could be anything from helping out at a child’s school, to serving lunches at a homeless shelter. Williams, for example, tutors once a week at an English as a Second Language class at a local high school. Workers don’t need to get their projects approved, nor do they need to provide proof of what they do.

In addition, the company sponsors numerous community involvement activities throughout the year employees can volunteer for, many of which don’t even count against their 12 days. This year, for example, the company signed on with Food and Friends, a program that has workers delivering food to homebound HIV and AIDS patients every Friday.

Company-sponsored activities run the gamut. Calvert workers have put on dances for senior citizens, done home repairs for downtrodden people and planted trees in community areas. They’ve participated in the homeless walk, the AIDS walk and the Cystic Fibrosis sports challenge. They’ve given blood and given food.

Calvert even enlists employees’ families in its community projects. Several years ago it created a Kid’s Day in lieu of Take Your Daughters to Work day (it actually has two Kid’s Days a year now). While the mornings of Kid’s Days are spent at the office learning about what Mom and Dad do, Calvert takes the kids out in the afternoon, along with children from the local Head Start program, to do community work. One time the children made crafts and then gave them to senior citizens. Another time they picked fruits and vegetables from an orchard and donated them to a food kitchen. “The kids love it,” Steward says. “It’s fun, but it’s also good for the kids to be able to see what’s happening and get a feel for the community.”

Kids are actually a big part of Calvert’s community outreach. The company brings students in from a local school once a year for a Career Awareness day. The students spend the morning taking a tour and talking with Calvert people about the mutual funds business. “Stan [Sorrell] has spent many lunchtimes being quizzed by the students,” Shober says. (“How much money do you make?” is usually the kids’ first question.) After lunch, the students partner with a mentor who works in whatever part of the company they’re most interested in, be it the computer area, the advertising business or HR.

Calvert also sponsors numerous internship programs as part of its outreach activities. It works with a program called Training Inc., which puts displaced people trying to get back into the workplace through a 26-week program before placing them in internships. It also partners with a children’s hospital’s Employment Adolescent Readiness Center. One participant from this program has been with Calvert for three years as a temporary employee. A gunshot victim who must use a wheelchair, the young man came to Calvert just out of high school with little vision for his future. He took an interest in computers, got some training in the computer operations area of Calvert, and now has decided to go into the computer science field.

Calvert’s investment in its people yields high returns.
With these types of programs, Calvert has become an employer of choice. Shober says she has noticed a difference in the resumes she has received the last few years. “The resumes I used to get basically were, ‘I want a job,'” she says. “Now, they say, ‘I want to work for Calvert.'” And, judging by the low turnover rate, employees who already work for Calvert don’t want to leave.

Obviously, the company didn’t get here overnight. Creating a culture of caring takes time in assessments, program design and implementation. It also takes money. But with careful planning and with attention to employees’ needs, a company can get the maximum bang for its buck. For example, although Calvert doesn’t have any quantitative comparisons between costs of benefits and savings incurred, the company claims attention to workers’ survival and emotional needs has kept sick days down, health-care expenses low and stress levels to a minimum. And career and personal development strategies designed to address psychological and spiritual needs have strengthened morale and lowered turnover rates, reducing recruitment and training costs.

A recent survey from New York City-based Towers Perrin indicates initiatives designed to help employees balance their work and personal lives indeed provide a solid return on what are, in most cases, relatively modest investments. According to the survey, companies with a high commitment to work-life initiatives believe they’re better positioned to compete effectively in today’s market environment.

In addition, the survey reveals more and more companies are paying attention to programs designed to help keep employees mentally and physically “fit,” such as tuition reimbursement for nonbusiness-related courses and subsidized fitness centers. “Employers recognize that easing work-personal life conflicts offers significant gains for both them and employees,” says Pat Milligan, a Towers Perrin principal and HR strategy consultant. “The level of appreciation of these programs among employees is very high, as are the potential benefits for the employer.”

Says Sorrell: “Yes, we have a bottom line. But there’s another line that deals with attitude, commitment and loyalty.” It’s that line that too often gets ignored. But as Calvert has proven, there’s a definite link between it and the bottom dollar.

It also has shown that there’s a link between a company’s culture and the products it sells. As Williams says, Calvert strives to be a company that would pass its own stringent screens for its socially responsible investments. As such, it gains credibility. Comments Bob Dunn, president and CEO of Business for Social Responsibility—a three-year old Washington D.C.-based organization of companies established by Ben Cohan of Ben & Jerry’s Homemade Inc. and others—”It’s certainly gratifying that a company formed to assess the policies of other businesses is being recognized for its own practices.”

Still think you can afford to neglect workers’ cries for more? The cost of improving quality of life may in fact be much less than the cost of not.

Imagine trying to create a family-friendly work environment without knowing anything about your work force other than that you employ both men and women. Chances are, you’d write the company’s policies around this issue from your own perspective, with perhaps some input from trusted sources. And, chances are, because you don’t know the perspectives of your workers who may be parents, who may be gay or lesbian and in nontraditional families, or who may have responsibility for parents or disabled siblings, you’d end up making assumptions, perpetuating stereotypes and neglecting the needs of many of your workers.

Unfortunately, this is precisely what has been happening at the country’s newspapers. A homogenous group of reporters write the news about the communities in which they live mainly from their perspectives, with input from trusted sources. Although these reporters may know the demographics of the areas about which they write—such as the percentage of minorities who live there, the average family sizes and so forth—they may know little about the perspectives of people within these groups. The news, therefore, often perpetuates stereotypes, scratches only the surface of a story and inadvertently neglects the needs of, and stories of interest to, many readers.

How could this happen? Easy. The demographics of the nation’s newsrooms simply haven’t changed as rapidly or dramatically as have the country’s. Just look at the figures. Minorities now make up approximately 24% of the total U.S. population, according to the U.S. Bureau of the Census. Yet, according to a survey by the American Society of Newspaper Editors (ASNE), minority representation in the nation’s newsrooms is only 10.91%. In fact, the ASNE calculates that nearly 46% of the country’s daily papers don’t employ any minorities at all. The question of whether this failing in employee diversity stems from newspaper companies dropping the ball in the past on recruiting from a diverse set of sources, or from the fact that the job of reporter traditionally has attracted mainly Anglos, is under debate. What’s certain, however, is that things need to change.

And, fortunately, they are changing. The ASNE reports that although minority representation in the newsrooms is behind the population at large, it has nearly doubled in the last 10 years. This can be credited to efforts, mainly by the nation’s larger papers, to make a change—not just in numbers but also in how those numbers affect their products.

One company recognized as an industry leader in this area is The Seattle Times Co. Last year, for example, the National Association of Minority Media Executives awarded The Seattle Times Co.’s Publisher and CEO Frank A. Blethen its Distinguished Diversity Award for Lifetime Achievement. This award recognized the family-owned business’s efforts at embracing “pluralism,” defined, in part, by The Times Co. as “the existence and preservation of groups within a society distinctive in ethnic origin, cultural patterns, religion or the like.”

The Times Co.’s commitment to this philosophy shows up in a work force currently comprising 21% people of color and 33% women. The makeup in the newsroom is similar, with 21% of the reporters and editors being people of color and 44% of them being women—placing The Times in the nation’s top 20 large newspapers (with circulations greater than 100,000) in terms of minority representation.

But even more than that, such initiatives as diversity training, a companywide diversity newsletter and a diversity council have ingrained pluralism into the company culture. And specific newsroom activities, such as minority intern programs, the creation of a diversity reporter and coach, and a newsroom diversity council, ensure that not only the company, but also its products, represent the community which it serves.

Diversity is a business goal for The Seattle Times Co.
The Seattle Times Co.’s diversity efforts began at the top with Blethen. In a statement to The Times Co.’s work force back in 1992, Blethen said: “The Times recognizes that its work force and the communities and customers it serves are changing. Because of these changes, achieving and managing workplace diversity is fundamental to maintaining our three core values: Staying independent and privately owned; maximizing journalistic quality; and maximizing employee workplace satisfaction.”

A lofty commitment, but one backed up by specific objectives:

• To communicate the company’s workplace diversity commitment to all employees, with emphasis on why it’s important to The Times Co. and what it means to the company
• To establish departmental employment/development goals, timetables and action plans to ensure the work force, at all levels, reflects the diversity of the communities the paper serves
• To develop companywide assessment and evaluation systems to monitor progress throughout the organization toward attainment/retention of a diverse work force and a work environment that supports pluralism
• To implement a cycle and procedure for reviewing with department managers and interested employees results from the previous year
• To develop ongoing communications systems to create and reinforce a high level of employee awareness of the importance of diversity to The Times Co.

These objectives have manifested in a variety of ways, beginning with the distribution of Blethen’s statement of purpose and diversity definitions to employees companywide. These things have then been reinforced in diversity training programs. Ten times a year, for example, the company holds a two-day training session called Exploration into Diversity. The training is mandatory for managers and voluntary for all other employees. It’s the only training available to everybody in the company.

The company purposely doesn’t engineer the makeup of the training groups, so, although key issues will be covered, conversations are dictated by the diversity mix at each session. This includes not only representation of both genders and different ethnic groups but also a mix of manager/non-manager personnel, union and nonunion workers, people from various shifts and people of varying ages.

The training program begins by repeating the philosophy statement and going over definitions, such as diversity, multiculturalism and pluralism. “We make sure everybody has a common understanding of what the terms are,” says Diversity Manager Phyllis Mayo, who facilitates the training sessions with a consultant. Then, the training participants explore why they think The Seattle Times Co. is focusing on diversity issues. “A range of things come out, all of which are true to some degree,” Mayo says. These include statements such as: “Because it’s the right thing to do;” “Because it’s the law;” “Because of the changing demographics;” and “Because if people can work better together, there will be better productivity.”

Once the group has established reasons why diversity awareness is important, it identifies obstacles to creating a pluralistic environment. Workers talk about their past experiences, about stereotyping, about some people’s prejudices and about how some people just don’t care.

The workshop’s next step is to focus on what can be done to overcome those obstacles. What can individuals do? What should managers do? What needs to be done companywide? Then Mayo helps the participants learn skills for staying aware of stereotyping and for looking at situations individually. “One of the things we talk about is avoiding knee jerk reactions,” Mayo says. To help people remember this, Mayo distributes little business card sized pamphlets depicting a knee jerk within a red “not” circle. “These serve as visual reminders people can look at frequently.”

So far, about 400 people have graduated from the workshop, and there’s a waiting list for future sessions. “People go back into their work areas and say, ‘you know, it wasn’t bad, it was pretty good, you ought to check it out,'” Mayo says.

Supplemental projects ensure training takes hold.
In addition to the two-day workshop, the company offers two-hour follow-up sessions every two months. The agenda for these vary: sometimes they’re training sessions, sometimes they highlight speakers. For example, recently, a graduate of the Explorations in Diversity workshop solicited a survivor of the holocaust who the paper had written about to speak at a follow-up session.

To supplement the training, the company publishes a “Diversity Works” newsletter six times a year. The publication, edited by Mayo and another HR person, reinforces Blethen’s message and the diversity definitions. It also lists upcoming training dates, offers games and puzzles that focus on diversity issues, and reproduces a diversity calender created by Diversity Tool Box Inc., which includes such highlights as the beginning of the Islamic New Year on June 21 and the anniversary of the Americans with Disabilities Act on July 26.

It was through the newsletter that the company announced a survey it would be doing to evaluate where the company is in terms of diversity and how far it still needs to go. The survey is based on research by Bailey Jackson and Evangelina Holvino, who have identified three levels of evolution that organizations experience: monocultural, nondiscriminatory and multicultural. Within these levels, the researchers have identified stages they call the White Male Club, EEO Compliance, Affirmative Action, Redefining and Multicultural.

The survey, being taken by all employees anonymously, will be used as a baseline for planning. At press time, Mayo hadn’t yet received all responses, but she did have some conclusions based on those she had received. Responses evaluate work units, which, depending on work distribution, can be full departments or units within departments (larger departments have as many as 30 work units).

So far, only one of the company’s work units has reached the level of multiculturalism. But, there’s now only one unit identified as still in the White Male Club or single-standard stage. “The bulk of the units are somewhere in the Affirmative Action stage, but we’ve also got pockets in the EEO Compliance area and pockets in the Redefining stage,” Mayo says. “Even within the same work units, some practices would be at the White Male Club end, and some practices would be considered Redefining and Multicultural.”

The survey has sparked some controversy within the company. One employee, unhappy with the term White Male Club, called a local radio talk show and generated a heated conversation that, according to the “Diversity Works” newsletter, “lambasted this company for its bigoted stand on diversity.” Another employee responded by writing a letter to “Diversity Works” that states, in part, “I don’t believe for one minute that our (The Seattle Times Co.’s) stand on diversity is bigoted. I do believe discussion and open dialogue

on diversity leads to self-examination, deep thought and growth. It certainly has in my case.”

Which is exactly the point, says Mayo. “I was thrilled with both comments,” she adds. “The most valuable piece of the Stages of Diversity survey is to establish a common frame of reference from which we can start talking about what it’s like to work here.”

Indeed, though the company has taken responsibility for grooming the culture of diversity by training employees and raising their awareness, it expects everyone in the firm to carry it out. “Our diversity efforts definitely are two-pronged: top down as well as bottom up,” says Mayo. “For example, the Explorations in Diversity workshop is a top-down mandate designed to put strategy into place, educate people, expose people to the concept of diversity and get them thinking about it.” But individual initiative must keep the ball rolling.

That’s precisely why the company recently created the Diversity Council, a group of 13 volunteers from throughout the company whose role it is to enhance communications and keep the issue of diversity alive among the people at The Times Co. Although newly formed, the plan is for the council to help identify information to go into the “Diversity Works” newsletter and to create projects that get workers involved with diversity issues. For example, the council’s current—and first—project is putting together banners that the work force will decorate. “We’re asking employees to contribute anything to these banners that represents for them one of their best moments at The Times,” says Mayo, who’s the council’s only permanent member. Items for the banners may be written messages, photos, drawings or pretty much anything the employee comes up with. The only criteria is that the items aren’t disrespectful and don’t hurt anyone. The Times Co. will unveil the banners in August—at its 100th birthday celebration.

Diversity awareness has sparked grass-roots innovations.
Employee participation in moving the company toward a pluralistic environment doesn’t stop with special projects, however. The company has pushed the responsibility for diversity planning down throughout the work force by instituting a formal diversity planning process for departments. “Instead of being a process whereby the managers go off and make a plan the way affirmative action planning used to happen, we take it to the grass-roots and have people look at what it’s like to work here and what things we can improve,” Mayo says. “Our feeling is that grass-roots really works. It hooks into what people are most interested in and what they’re willing to do first.”

According to Jim Schafer, VP industrial relations, the plans may be specific to hiring objectives, or they may be as general as educational objectives. “It requires each major department to set out what it intends to accomplish in terms of furthering our transition from diversity to pluralism,” he says. “There’s a whole range of things that might be taken into consideration, but they’re specific to where the departments are.”

Some departments, for example, focus primarily on mentoring new and existing employees. Others create career-development strategies that include having people from different work areas come to regular meetings and talk about skills needed for their jobs, about the department’s direction, and about any open positions.

Many departments create their own newsletters, which they use to talk about diversity issues. Sometimes they highlight individual employees, let them talk about what it was like growing up in a Jamaican family or living in an ethnic neighborhood. “Whatever they’re willing to do first is a good step,” Mayo says. “We don’t evaluate whether one person or department is doing less than another person or department. Any first step is wonderful because then you just take another step.”

Some of those first steps include participating in the speakers’ bureau and talking to school kids about diversity. For others, whose jobs may not permit them to take time away, first steps may be engaging in pen-pal programs with children of ethnicities different than their own. “We added kids to our strategy because we realized that most people like kids, no matter what kinds of kids they are,” Mayo says. “So some people have gotten through their stereotypes by working with children rather than adults.”

Some employees have gone beyond what’s expected of them and started their own grass-roots initiatives. Mayo says much of what the company does started at a grass-roots level. For example, two early graduates of the Explorations in Diversity workshop created a Diversity of Thought library at the company’s headquarters. Struck by the idea of having an onsite library that contained materials focused on diversity, the two approached Mayo with it. Although Mayo believed it was a marvelous idea, she informed the workers that there wasn’t a budget to do it as a corporate initiative. So the workers went to the art department and made up some posters asking employees to donate books that reflect their interest. Today, the library contains approximately 300 books. Four or five employees volunteer as librarians, keeping a list of available books on E-mail and sending requested books by interoffice mail to employees at other locations.

Another group of employees expressed their belief that it’s important for people to be able to meditate for religious reasons. So, once a week, the company makes space available for just this purpose. “We have a practice that says we’ll give any group, as long as it isn’t hurtful to others, time and meeting space,” Mayo says. “They just need to make sure that whatever they’re doing isn’t interfering with their jobs.”

Other groups formed at The Times Co. include the GALA group, which stands for the Gay And Lesbian Association, and a child-care committee known as Family Connections: A Seattle Times Committee for the Enhancement of Family Life.

Diversity awareness has boosted The Times Co.’s employee retention and reputation.
Being able to form groups according to their interests has been an important employment factor to many people at The Times Co. “We have folks who seem very willing to give the organization an opportunity to change, to make mistakes, because they have a sense of acceptance, a sense of belonging,” Schafer says. Indeed, all of the diversity activities have contributed to turnover lower than the industry average. They’ve also earned The Seattle Times Co. a reputation as a great place to work.

But, these activities have also created unique challenges for the company. “It’s kind of a double-edged sword,” says Mayo. “When you raise people’s consciousness about diversity and you say that it’s one of your values, perfection is a tough status to achieve, and there’s always something that someone can point to as a deficiency.” Recently, for example, three minority reporters left the company for varying reasons. “The cry was, ‘look at all of these people of color leaving. There must be problems in the newsroom,'” Mayo says. “Some Caucasian reporters left also, but no one was counting and saying, ‘The whites are fleeing.'” She adds that this reaction is OK, because it means people are paying attention.

The Seattle Times Co. hopes to keep people paying attention by continuing to add people of color to its staff, as well as help improve the number of people of color in the industry as a whole. Part of the strategy for doing this is through a number of intern programs specifically for minority students. One such program provides juniors and seniors in high school the opportunity to produce their own newspaper, called the Urban Journal. “It’s specifically targeted for students of color because there are so few people of color in the newsrooms,” says Mayo. “We’ve been criticized for that, and some teachers won’t support it. But we’ve resisted opening it up to all students because white male students have lots of other avenues for getting into this industry, and do get in.”

However, The Times does have several other internship programs open to students of all ethnicities, including some that give journalism students repeated summer experiences. Many, though not all, of the students from all the internship programs stay on at The Times. Those who do, especially those from the minority programs, help maintain the newsroom’s diversity balance. But, as has been demonstrated throughout the organization, numbers alone aren’t enough. It’s by talking about diversity issues, making diversity a priority, and taking an active role in ensuring that pluralism takes place that positive results concerning diversity occur.

Attention to the human issue of diversity affects the company’s product.
Because the idea of diversity has permeated the company culture so profoundly, it has begun to affect the products that the company produces. To be exact, it affects the news.

In a statement carried in “Diversity Works,” Blethen confirms the relationship between the company’s diverseness and the product it sells: “The world is rapidly changing around us. Both our advertising customers and, more importantly, our readers, have become more diverse in ethnicity, lifestyle and family definition. If we expect to maintain our circulation readership and our position as the area’s leading information provider, our news and editorial content must reflect the diversity of our readers. That will happen only if our newsroom reflects that diversity.”

Adds Schafer: “This is a bit of a unique business in the sense that we’re providing information to a lot of subscribers in this community, and for that information to be fair, appropriate and objective, it should be reported by essentially the same kind of population that’s reading it.”

Certainly, having a newsroom composed of 21% people of color and 44% women is reflective of the readership, at least in terms of numbers. In fact, according to the latest U.S. Bureau of the Census numbers, tallied in 1990, people of color represent just more than 13% of the Puget Sound region’s population.

Though the newspaper feels it has gained positive results from its heightened newsroom diversity, this is more than just a numbers game. Several initiatives specific to the newsroom are aimed at guaranteeing those positive results are reflected in the newspaper. One such initiative is the creation of a Diversity Committee. Says Schafer, the focus of the committee, which was formed approximately seven years ago, is both on content and on education. Committee members—reporters, editors and photographers—meet bi-weekly to evaluate the paper’s content and educate the rest of the newsroom staff about diversity issues. For example, the committee will lead a discussion as to whether a topic was handled appropriately, with the proper sensitivity and without being offensive. “It’s primarily focused on the way in which information is gathered and communicated, rather than things like employment policies,” Schafer says.

Alex McCloud, managing editor of The Times, says the committee has provided a constant forum for discussing what it is the reporters, editors and photographers are contributing to the newspaper, and also how diversity is effecting the newsroom itself. “We’ve created an environment in which people are free to express their opinions, even when they aren’t shared by anybody else or only by a few others,” McCloud says. “And, by having the committee, the watchdog responsibility doesn’t fall to one or two people.”

The newsroom further checks itself by performing periodic content audits of photographs. Instituted in 1988, the content audit evaluates the representation of women and people of color in The Times’ photographs to see if the representation “reflects accurately their participation in the world around us,” McCloud says.

By doing the audits, The Times’ newsroom staff has significantly improved the content of its photos during the last seven years. “Early on, the representation of people of color in photographs was less than our population within the community,” Schafer says. “And the photos of people of color were disproportionately associated with negative stories—articles about financial conditions and crime, for example.” But today, McCloud says, women and ethnic minorities are just as likely to be portrayed in positive or neutral contexts as are white males. “It’s a change that’s been recognized in the community,” he says.

How can he be sure? Well, the editorial staff periodically ventures out into minority communities and solicits feedback about how the newspaper covers them. The company also brings people from these communities to its offices and asks them to critique the paper and discuss with the staff their opinions on how issues important to them have been portrayed through words and pictures.

Gloria Trinidad, a multicultural education specialist with the city of Seattle’s child-care and Head Start programs, reviewed something like 75 Times articles for a special outreach program designed to help teachers communicate diversity (see “The Times Puts Diversity Talks on Common Ground”). Discussions within her group helped the newspaper staff better understand how a news item can perpetuate stereotypes simply by not exploring deeply enough for the human elements. For example, the group commented that articles intended to be positive—such as ones about women who work their way off of welfare—could be richer and present a fairer view if they were more personal and focused on the situation’s human rather than its economic elements.

Reporters learn to recognize diversity angles to news stories.
These are things that Aly Colón knows well. As diversity reporter and coach for The Seattle Times, it’s his job to seek these angles out. When a murderous shooting occurred at a local Vietnamese nightclub, for example, Colon reported on a story behind the story. While news reporters simply reported the facts of the incident, Colón wrote an exposé on the clash of culture and crime—reporting on the challenges police had matching up statements because half of the nightclub patrons had the same last name; the difficulties involved with the language barriers; and the problems presented by the Vietnamese’s distrust of authority brought with them from their home country.

In his year and a half in this job, Colón has focused his reporting on articles that, like this one, portray the intersection of where different people meet and how they react to that intersection—how it affects them, what it means to them, how they feel about it. “Everybody on the staff is tasked with trying to be more inclusive in their reporting in terms of diversity, but my job is to look at diversity in as diverse a way as possible,” he says. For another article, for example, he visited a new immigrants’ class for secondary school teachers at a local university and reported on what the teachers were learning about what being a new immigrant means to people, what kind of reactions the immigrants were getting from people and how immigrants are adjusting their cultures to fit with that of the United States.

For another article—which Colón titled “Speechless in Seattle”—the reporter, who is a native of Puerto Rico, walked around the traditional tourist sights of Seattle speaking only in Spanish. He then chronicled how people reacted to him and how they dealt with the difference. “What I’m trying to do is encourage a more diverse approach to the way that we look at the community around us,” Colón says.

He does this through his own stories, as well as through his role as diversity coach. This is a unique position. Colón says The Times doesn’t know of any other newspaper in the country that has a person on staff who is a combination diversity reporter and coach. The position came out of Diversity Committee discussions about the need for one person to be sort of the sounding board on diversity issues. But, says Colón, who got the position because of experience as both a writer and editor and because he’s lived in and traveled most of the world: “I’m not a PC police or a guru in the sense of what I say goes. And, there’s no requirement on my part to go after people, and no requirement that says they have to come to me. But I’m there as a resource for people who are trying to branch out into a variety of different areas, and who want to be able to turn to somebody who’s attuned to the different groups of people out there.”

In his role as coach, he advises reporters about diversity angles that stories within their beat can take, and provides them resources that may help them expand their perspectives. “People have a tendency to go where they’re familiar, and that includes turning to a regular bevy of sources,” Colón says.

Often writers and editors will seek Colón’s opinion on whether the depiction of a particular group of people is fair and accurate. Sometimes, these discussions happen after the fact, when readers contact the paper with concerns over a particular portrayal. “I’ll talk with the reporters and editors about how that came about, what the reasoning was behind that approach, and help everyone involved understand the different points of view,” Colón says.

Whether these discussions happen before or after an article is written, the point is to get people thinking and talking about these issues. Another device that helps keep the idea of diversity in the reporters’ and editors’ minds is a diversity checklist. The checklist includes such questions as: “Have I sought diverse sources for this story?”; and “Am I furthering stereotypes as I seek diversity?”

“It’s one of those tangible reminders to people, as they approach the work they do, to get outside their boxes and recognize there are diverse sources. To do our job well, we ought to think about these things in the same way we’ve always thought about who, what, when, where and why,” says Managing Editor McCloud.

The Diversity Checklist, like so many other innovations at The Times, was created by a group of workers. It has proven a useful tool, and even has been reproduced in a publication by the ASNE on how to conduct newspaper content audits.

Says McCloud: “The most important thing is to have people thinking and talking about diversity. That’s what our whole emphasis has been on: To have a diverse group of people who respect one another, who will listen to one another, and who will, in the end, produce a better product.”

According to Schafer, the product has changed dramatically during the last decade, due in part to the diversity efforts. The paper has an excellent reputation in the industry and among newspaper readers. And its circulation has been steadily increasing. As of March, it was at 234,000.

The Seattle Times Co.—proof positive that human issues affect the bottom line.

Customers of L.L. Bean know that they’re the boss. They can order hunting equipment 24-hours a day. They can request fishing poles to arrive, via Federal Express, within two days — at no extra charge. And they can return broken car racks after years of use.

Indeed, the Maine-based mail-order company has a reputation for superior customer service. It’s a reputation that dates back to 1912 when founder Leon Leonwood Bean made good on nearly an entire shipment of hunting shoes that came back to him unstitched.

It was this reputation that prompted Leon Gorman, grandson of Bean and current chairman of L.L. Bean, to apply for the Malcolm Baldrige National Quality Award in the service category in 1988, the first year out. He proclaimed that despite the outcome, Bean “will be under a great deal of pressure to renew and enhance our quality improvement efforts to make sure we live up to our reputation.” The organization came close to winning — it was one of two companies that qualified for a site visit — but no award was given that year in the service category.

Bean used feedback from the Baldrige committee to carry out Gorman’s desire to renew and enhance the company’s quality improvement efforts. It embarked on a total quality management process that would lead it first through changes in people management and later through process revisal. HR at the company not only has managed the TQM process, but the changes that have gone along with it. In fact, HR has become the Total Quality in Human Resources department. And although the company already has experienced increased profitability, improved return on sales and return on equity, it’s only halfway through the process.

Feedback helps Bean redefine total quality.
The Baldrige experience prompted Bean to take a hard look at its culture as it relates to quality. The award committee had been impressed with Bean’s customer-service levels, citing them as “world class.” However, it told the company that it wasn’t getting customer satisfaction in a productive way. It had been satisfying customers through a guarantee-based approach to quality. Indeed, “We really pioneered the no-questions-asked guarantee,” says Robert Peixotto, vice president, total quality and human resources.

The Baldrige committee told Bean that, rather than relying on its guarantee, it should be ensuring that things happen right the first time. For example, legend has it that a customer-service representative in Freeport once strapped a canoe on his car and drove it to a customer in New York who had ordered one for a hunting trip he was leaving on the next morning. Although this certainly was a demonstration of exemplary customer service, it also served as a sign that something was wrong. Had the canoe arrived in time in the first place, there would have been no need for heroics.

The other advice that the Baldrige committee gave to Bean was that the company needed to have more employee involvement. This came as a surprise. “We had for a long time prided ourselves on employee involvement, doing attitude surveys and climate studies,” says Peixotto. “We did quality circles back 10 years ago when they first came out.” Certainly, the employee who delivered the canoe 300 miles away was involved.

But Peixotto says Bean learned that these things constituted only token involvement. “We didn’t understand the whole concept, letting people really take responsibility for quality in their work,” he says. “We had been a fairly traditional hierarchical organization in which decision making occurred at a high level.”

To truly live up to its reputation as a high-quality service organization, then, Bean needed to embrace the concepts outlined by the Baldrige committee and put them into practice. Taking the committee’s two suggestions for improvement, the company developed a definition for the total quality process it would pursue: “Total quality involves managing an enterprise to maximize customer satisfaction in the most efficient and effective way possible by totally involving people in improving the way work is done.” In short, Bean’s upper management looked at total quality as the way you involve people and the way that you improve processes.

Because it’s a service organization, the company determined that, after training the work force on general TQ concepts, it must begin making changes by focusing on the employee involvement piece. “Quality for us doesn’t happen on a production line, but every time you call up one of our phone centers and talk to a customer representative,” says Peixotto. “That interaction is where quality really happens for Bean.”

The goal of HR during this process would be to change the infrastructure of the company to support that customer interaction. Bean had to ensure that the frontline, customer-contact employees were knowledgeable and empowered, and that they were well supported by management. In fact, because it would be the managers who would empower their employees, HR concentrated on changing their role in the organization first.

Managers use employee input on total quality to become coaches and developers.
Bean spent approximately 10 months familiarizing its then-3,000 workers with total quality and what it meant for Bean. All salaried individuals in the organization received three days of TQ training and all hourly workers received one day. “We started with the senior level and we rolled the training on down through the organization so that each level within the company was well versed and able to support total quality as the next level learned about it,” Peixotto says.

After everyone was trained, HR enlisted nearly 70 people within the organization to begin putting their knowledge into action. The department created seven quality action teams, comprising eight to 10 workers from across levels and functions in the organization. HR team leaders solicited the help of line managers and employee-relations specialists to identify people who not only would have an interest in serving on a team but also would easily be able to speak up around individuals from different organizational levels.

Once formed, the teams worked simultaneously on projects to bring about change. Although they each worked independently, the teams drew upon each other’s work. One of these teams set out to define a total quality manager for Bean. “We had never done this at Bean before,” says Peixotto. “We basically had taken our best doers and promoted them into management roles.” In these positions, they continued doing. To support the newly defined quality organization, however, the team determined that the role of manager had to change to one of a coach and developer.

Another cross-level, cross-functional quality action team incorporated this new definition into the management learning program it was developing. The ensuing program is set up so that once a month more than 150 of Bean’s highest level managers, including the president, sit down and discuss what being a manager in a total quality environment means. “It isn’t really training,” says Peixotto, “although we do some of that. It’s more of a facilitated discussion about what employees need from us as managers and how total quality is changing the management game.”

Some of the topics that have been addressed during these discussions are rewards and recognition, measuring employee involvement and team development. Occasionally, the company brings in guest speakers to talk on topics such as learning organizations.

Nick Sampson, manager of customer service and operations for the company’s retail store in Freeport, says that the sessions provide a consistent message, one that says “when you’re talking about creating measurable goals, this is how we do it at L.L. Bean, this is what we expect.”

To ensure consistency, another quality team created a feedback instrument for managers. The team first determined nine dimensions of a total quality climate, which are that it needs to be:

• Aspiring and focused
• Ethical and compassionate
• Customer focused and aligned
• Effective and efficient
• Challenging and empowering
• Open and innovating
• Objective
• Rewarding and developing
• Team oriented.

The group then incorporated these dimensions of quality into a Feedback For Improvement survey that would be used as a development tool for managers. For each dimension, the team listed statements for which employees answer to which degree they agree, disagree or are neutral to the statement. For example, under the “aspiring and focused” dimension is the statement, “I clearly know what’s expected of me and what the major priorities are.” Other statements: “I receive regular coaching and counseling that helps me improve my performance in my work unit,” and “My supervisor helps me anticipate and solve problems.”

Each statement is worth up to seven points, with strongly disagree scoring one point, and strongly agree scoring seven points. The scores are then averaged together.

The managers take these surveys and hold feedback forums with the people who filled them out. In a room together, the manager and his or her people (and sometimes a facilitator per the manager’s discretion), discuss the answers and determine issues that need to be addressed. “We sit down and work out plans and goals to improve the scores, maintain the scores or maybe even in some cases drop the scores if they’re too high and hindering other scores from becoming higher,” Sampson says.

The company asks managers to develop three action plans for improving their scores. For example, during a feedback forum in 1992 involving Sampson and his staff, one of the issues discussed was that workers don’t always understand initiatives or priorities. The action plan decided on by the group for Sampson was to clarify the customer-service department role and purpose and communicate better what and why an initiative has been taken. Says Sampson: “Just to focus on [the scores] brings us to the conscious state of saying, ‘let’s discuss how we do our work.’ “

Results of the feedback survey and forum are then folded into the managers’ performance plans. A quality action team actually revised the performance review system to account for this. In replace of the old system that listed a series of projects managers had to accomplish during the next year or specific numbers he or she had to reach, the new system reviews four different areas. One is operational responsibilities, which basically encompasses what the old reviews used to. The second element reviews how well the manager is performing his or her role. A manager’s supervisor assesses this in three ways. One is by looking at feedback survey scores. Actually, supervisors don’t look at specific scores but improvements in scores. “We’ve learned that there are certain functions within the company in which it’s easier to get higher scores,” Peixotto says. Therefore, the company rates managers based on their rate of improvement instead.

Supervisors also engage in a method called One-Over-One for evaluating the effectiveness of managers below them. Basically, what this means is that they annually talk with the managers’ subordinates about their career development, the climate in their area and what types of things they need from their manager that either they are or aren’t getting. “If you think of an employee as a customer of a manager’s management, we’re asking the customers of the managers how they’re doing,” Peixotto says.

Finally, managers’ reviewers run through a list of questions, such as, “Has the manager hired good people? Is the unit more capable than it was a year ago? Do people seem to know what they’re supposed to do?”

The third piece of a manager’s performance review evaluates their total quality behaviors or impact on climate. Their bosses pose the managers such questions as, “What are you doing as an individual to help support the company’s move toward a total quality workplace? Are you participating in improvement efforts? And, are you providing and receiving feedback well?”

The final part of the review system looks at the learning activities the manager has received in the last year and the developmental steps that need to be taken in the upcoming year. “That was a major change in the way we held people accountable for their work,” says Peixotto. “It wasn’t just hitting the numbers anymore. It was how you got there, the approach that you used and whether or not you participated in improvement.”

Because the company has a pay-for-performance system, managers’ salaries are affected by the results of their reviews. Also, the company bases promotional decisions on performance as defined in the total quality climate.

With the aid of Thomas Rand, president of Management Research Group, Bean used the FFI survey to compare the traits of effective managers within the total quality environment with those previously considered effective. Rand and Bean looked at the management practice and style of more than 100 managers (a manager in this case is defined as anyone who supervises three or more people).

Using Rand’s company’s Management Effectiveness Analysis, Bean discovered that effective managers in the quality climate shared similar traits. Most were clear about expectations and defined accountability. They were involving, participative and empowering with their staffs, although most still took on the role of boss and were identified as being in charge. Effective managers had high performance standards, were creative and resourceful, open to change, and strategic. They also were more persuasive than less efficient managers, serving as advocates. They were high on feedback and addressed conflict.

Peixotto says that the feedback generated from this and the FFI survey has proven to be powerful, allowing for conversation to occur that probably should have happened years ago. More than that, however, they have been successful at turning managers into the coaches and developers that they need to be for a quality environment. By changing their role, they have in turn created an empowered work force.

Employees embrace total quality and initiative.
Take the manufacturing division for example. Peixotto recently talked with a footwear manufacturing manager who, in the face of tremendous productivity pressures, had managed to spend a large amount of money on training. The manager told the HR professional that it was simple. He explained: One day he shut down one of the production lines and spent the morning teaching employees how a shoe is costed — something the workers had never been told. He explained to them what each of the various operations involved in making the shoes entails, and they learned about the costs of those operations and the materials that go into the costing of a shoe.

In the afternoon, he took the employees out onto the floor and asked them to show him ways the company could save money based on what they’d just learned in the morning. The employees found enough savings that day to pay for all the training conducted in that department all year.

The manufacturing department actually has deployed total quality the most effectively in the company, says Peixotto. A few years ago, it was losing money, and nobody wanted to work there. Recently, however, it won the Maine state quality award, called the Margaret J. Smith award. Also, the department’s costs of poor quality have gone down 47%, and its factory defects have been decreased by 10 times. Return on assets has improved 223%. “What’s really made the difference is employee involvement more than anything else,” Peixotto says.

In the total quality climate, employees who see a place for improvement can make the necessary change on the spot. Employees who work on manufacturing the camp moccasin, for example, made a simple adjustment on a glue machine that has resulted in tremendous savings. They observed the process of the shoes going together and noticed that when glue is squirted on the sole to affix it to the leather uppers before stitching, an excess amount spills over that must be wiped off in the final stages of production. By reducing the amount of glue that comes out, they’ve not only cut down on waste, but have eliminated a step in the production process.

“We’ve worked very hard at trying to create a climate where employees can take responsibility for quality and make improvements where they see them,” Peixotto says. For that reason, Bean consciously decided not to have a suggestion system. “That’s a prop,” he says.

Instead, the company consistently offers support and learning that enables employees to take initiative. Recently, for example, management asked the workers from Bean’s retail store in Freeport who stock shelves to trade jobs with the workers in the distribution center who pick the store orders. The employees are customers of each other.

From the job-swap experience, the workers simplified a process that no one had questioned before. Here’s how they formerly worked together: The stockers would place orders with the distribution center for items running low in the store. Pickers at the distribution center would gather those items on rolling carts, have them packed in boxes and loaded onto trucks. When the items arrived at the store, stockers had to unload them, unwrap them and put them on rolling carts to take them to the shelves. When the workers saw both sides of the process, they realized there really was no reason for packaging the items. Now, the pickers simply roll the carts holding items directly onto trucks so that stockers can roll them right off. Each customer more efficiently serves the other.

Employees such as these who take initiative are rewarded through recognition programs put in place to support the total quality efforts. The company allots each major line area a budget to be used specifically by managers to pay for recognition awards. The company gives out few cash awards, opting instead for symbolic awards, such as dinners out or Bean merchandise. Currently, the company is spending approximately half a million dollars a year for this program.

In 1989, Bean instigated the Bean’s Best Awards. According to Peixotto, this is the company’s highest form of recognition. All regular or temporary employees, or teams of employees, hourly or salaried, are eligible for the award (last year, one out of every three employees in the company served on some sort of work team). Workers can nominate co-workers, bosses or subordinates. A cross-level, cross-functional group of employees determines winners based on the following criteria, which are tied to total quality:

• Provide exceptional customer service — internal or external
• Have innovative ideas
• Standout as role models
• Are experts at what they do
• Manage people exceptionally well.

Winners are honored at an awards ceremony in August with their families in attendance. “It’s a big deal,” Peixotto says. “It’s like the Academy Awards night.” Winners are treated to a lobster bake, have photos taken and even are congratulated via planes flying overhead. They receive glass pyramid awards and L.L. Bean merchandise, including a pair of Bean Boots with life-time resoling.

Last year, more than 650 nominations of individuals and teams were made. Of those, only two teams and six individuals received awards. “Employees hold this Bean’s Best Award in high regard,” Peixotto says. “They’re selective. They really cut through all the politics and ask, ‘who are standout role models here, who live the values of the organization?’ “

He adds that those people who are singled out as Bean’s Best place a high value on winning the award. For this reason, the award has served as a valuable tool in supporting the total quality climate.

One tool that Peixotto admits needs some work to align with the total quality environment is L.L. Bean’s compensation plan. Bean did install a pay-for-performance system as a consequence of changes in management performance. However, Peixotto says that the human resources staff is just beginning to address the team-based aspect of the business by looking at such systems as skill-based pay.

Human resources’ role in quality management expands.
The Total Quality in Human Resources department itself is changing to fulfill its function as a catalyst for total quality, a function spelled out in the department’s mission statement. Although the managing of total quality wasn’t originally assigned to the human resources staff (it started off as a special small function reporting to the president, then aligned with operations for a while and with strategic planning for a short time), human resources became a natural place for it to settle.

“We’re looked upon by the organization as being the owners of everything that supports total quality,” Peixotto says. “Total quality itself is owned by the employees, but all the support systems for it belong to the total quality in human resources department.”

The last three years the department has spent changing the infrastructure of the company to support total quality behaviors — instigating the role revision for managers, creating a climate for empowerment and setting up support systems, such as feedback forums and recognition programs. Now it’s moving into managing the change that will result from process improvement.

The company has slated four major process improvement initiatives for this year alone. “When you change these processes, the big name of the game is managing change because it’s going to create a tremendous amount of change in the organization,” Peixotto says. “One of the things we’re focusing on in the human resources department is increasing our effectiveness at helping people understand their processes and being able to cope with the level of change that we’re creating.”

To do this, human resources is re-engineering from being functionally organized to being more customer organized. It’s moving the strength of the department out of human resources offices and into customer areas by setting up service teams to support each area. The service teams represent the breadth of the expertise that the department brings together. They offer process improvement, health and safety, employee relations, training and so forth. But it’s all decentralized.

In addition, the department has created a resource center, which provides the expertise to support the service teams. “We’re just moving to that organization now,” Peixotto says. “We’re [not quite] where we need to be to support the massive changes that we’re unleashing on L.L. Bean.”

Nevertheless, the Total Quality in Human Resources department has made tremendous strides thus far. In a recent Feedback For Improvement survey, only 36 out of 3,000 Bean employees disagreed in any way with the statement, “I feel strongly committed to L.L. Bean and its goals.”

The fact that Bean began its TQ process with people issues is key. “Bean is about people and respect for people,” Peixotto says. “This is a way of respecting the talents within the organization. A lot of companies see people as the problem. We saw people as part of the solution.”

And those people have contributed greatly. When the company started its TQM process, it had been experiencing flat sales for a couple of years. Since that time, return on sales, which the company uses as the barometer of productivity, has increased 80%. Moreover, returns for quality are down 25%, lost-time injuries have decreased 40% and work-in-pro-gress cycle time has improved 332%, from more than three weeks to less than four days.

Perhaps the organization’s most significant accomplishment, however, is that through the people involvement in total quality processes, L.L. Bean hasn’t in any way tarnished its reputation for superior customer service. In fact, it has polished it by adding internal customers to the list of satisfied customers — job satisfaction, as measured by the Feedback For Improvement process, is up 12-1/2%. And from the outside, not much has changed. Customers still receive Bean’s no-questions-asked guarantee — if necessary. However, it’s less frequently necessary.

Pesonnel Journal, July 1994, Vol. 73, No. 7, pp. 72-83.