Pinch a Penny Now, Lose a Dollar Later

What was your last shopping experience like when you ventured into a discount retailer (and, yes you have been in one admit it)? If your experience was like many other individuals' you were greeted by a retail store with merchandise strewn about, items in the wrong locations, advertised items missing from store shelves, not many employees around to ask questions of, and (if you found an employee) were met with a gaze from a tired, distracted, and overextended (or worse - a disinterested) employee. Conversely, what was your last experience when shopping at a "full price" retailer? For the most part, polls have shown that shoppers are willing to pay a small premium for better service and a better selection. People like to feel their shopping list is as important to the retailer as it is to them (after all, you earned your money, they should earn the right to take it as well). Don't worry there is a human resource connection coming.....

Let's go back to the discount store with the unhappy employees. What we know, as human resource professionals, is that unhappy employees = lower productivity, increased use of sick time, and lower ratings on customer service. So why are discount retailers (and many other areas of industry) lowering wages and shedding experienced employees? Yeah, yeah - we know - it's to be able to make those shrinking budgets. What if, though, we were actually accomplishing the reverse with our actions? Instead of steering our organization through an economic downturn we were further jeopardizing its health by driving customers away?

Professor Zeynep Ton, of MIT's Sloan School of Management, has ten years of research to back up why it might not be such a good idea to put the squeeze on your employees. In the Future of Retail: Companies That Profit By Investing in Employees at Time.com, Ton's research finds "companies that buck the status quo and invest heavily in their workforce actually are able to not only compete with their competitors on service but on price too". This upends the notion that to compete in the market as a low-cost leader, a company must have a low-cost workforce. In fact, Ton states that retail chains that experience high levels of success "invest heavily in store employees, but also have the lowest prices in their industries, solid financial performance, and better customer service than their competitors".  

What, exactly, makes successful companies successful anyway? It's in their "business card".  Remember the old standby in business - it holds true today: your employees are the face, the "business card" of your company. The experience customers have with your company is heavily influenced by their interactions with your employees. Ton's research found "all sorts of efficiencies that become unlocked once you have a highly trained, highly motivated workforce". 

So take a cue from those that are successful now, and are set to continue their success and growth once the economy turns in their favor: invest in your employees. Yes, pay them a decent wage, provide a content rich and inclusive training program, offer great benefits, and promote a culture of innovation - then, maintain as you enjoy success...   

"Looking for a Unicorn"

Staying with the theme of "unicorns", the title of this post is taken from a Wall Street Journal article by David Wessel entitled Software Raises Bar for Hiring. In the article the president of Mindbank Counseling Group, Neal Grunstra, relates the stringent and highly specific requirements that many companies have for job vacancies as akin to "looking for a unicorn". Peter Cappelli, a human resources and management professor at Wharton School, cites an email he received from "a company that drew 25,000 applicants for a standard engineering position only to have the HR department say not one was qualified". 

Okay, so it makes sense that the current plethora of candidates for the dearth of job vacancies means that hiring managers can afford to be picky; after all the current state of the economy is a result of not enough jobs to go around.  Is that what is really happening, though? Or is this issue more about a lack of candidates with the right skills? "For every story about an employer who can't find qualified applicants, there's a counterbalancing tale about an employer with ridiculous hiring requirements", Capelli states. 

What about the issue of selection software? Software used in the process of recruitment and hiring was initially intended as an aid rather than a substitution. Now, many applicants submit their resumes in the hopes that they have included enough key words to get their resume through. Most applicants never get the opportunity to speak to someone.  Does this mean that an applicant who cleverly included a sufficient number of key words in their resume is better qualified for a position? Inherently no. 

This problem has spurred new developments in selection software. In Seeking Software Fix for Job-Search Game, Lauren Webb writes that the ideal software would "read resumes intelligently, flagging a handful of truly promising candidates to recruiters and alerting job seekers to openings that are laser-targeted to their skills and background". So, if companies are really intent on finding that unicorn they need to consider more than whether the candidate is great at manipulating their software selection criteria and focus on widening the scope. "Cultural and behavioral fit is a stronger indicator of success and business performance" states Elaine Orler of Talent Function Group. Capelli puts it this way: "[employers could] back off the strict requirement that applicants need to have previously done precisely the tasks needed for the vacant job" and "see if they could do the same with some training...".

Grooming Your Unicorn

I am going to begin this post by restating something I have said in the past: happy employees = more productive employees = increased sales, etc.. Shawn Achor, Harvard-trained psychologist and happiness researcher, understands this.  Archor says that we should be looking to design programs around the outliers, the star performers (sometimes so rare they are akin to mythical beings) instead of utilizing "one size fits all" programs implemented with the average employee in mind. Think about that. Most programs are developed using the mean rather than those "odd" employees who offer unique and innovative solutions, who continuously take initiative, and who may not fit the prototypical employee in your organization. As you will see in Archor's TED presentation below, that employee is more apt to turn stresses into challenges that beg for solutions they are happy to work toward.

So go out there and benchmark your stars rather than the average and "groom your unicorns".

Making Good Health a Competition

I recently received a $50 Target gift card in the mail. I received this gift card because I filled out a health questionnaire for my organization's health care plan. Getting $50 to spend at "Tarjay" was easier than having a birthday (because I wasn't a year older). The gift card was an incentive, one of many various organizations use in an attempt to raise the health-consciousness of their employees. 

This wasn't the first attempt by my organization to form a healthier workforce. In the past we had the "Take the Stairs" challenge where employees were encouraged to use the stairs rather than the elevator. When the challenge first began there was a communication push tied to a contest on how many flights total tallied up. Since that initial push, the most that has happened is doodling on the stairwell sign-in sheets. Then there was the challenge for who could walk the most steps in a span of time. Each participant was given a pedometer and teams were formed, mainly based on the floor your office was located on. None of these seemed to make an effective, lasting impact. Was there some value in these efforts - yes. They were low cost and did lead to re-focusing attention on employees' health.

Why did my organization take the time and effort to partner and promote these challenges? Health care costs. It's a fairly straight line from the aggregated health of your employees to the costs of health care premiums. Healthy people tend to use their health care benefits less often, tend to use less sick days, and are more productive. Apparently a healthier workforce also results in less presenteeism (don't worry, I had to look it up too). Presenteeism, according to the CDC is "the measurable extent to which health symptoms, conditions, and diseases adversely affect the work productivity of individuals who choose to remain at work".

According to statistics noted in "Pitting Employees Against Each Other...for Health" and appearing the Wall Street Journal, 60% of employers polled by consultants and the National Business Group on Health indicate their future health initiatives will include online games and other competitions between employee groups or locations.  After reading this, I began to question just how effective are these methods for bolstering the health of employees? To answer, I considered the challenge for walking the most steps. After participants received their pedometers it wasn't long until word spread that you could "tip the scales in your favor" by jiggling the pedometer (no walking needed). I'm afraid the message on health was lost on some employees. 

How do you ensure participants in health games are not cheating? You could require they use "tamper-proof" devices like digital pedometers or heart-rate monitors like those used with Humana's incentive program HumanaVitality. This may cause other issues, though, like backlash from employees who feel their privacy invaded. "The more you make it formal, the more burdensome it might feel", states health and welfare benefits leader Carolyn Plummer.  

I guess we will stick with our small, low cost efforts for now....

A Beta You

Reid Hoffman, the co-founder of LinkedIn, has written a book titled The Start-Up of You. In this interview, Hoffman speaks to Time.com about how putting the effort into developing yourself can payoff in your career. What I especially liked was the statement to consider yourself as the beta version.  You are out there, working and learning but at the same time you should be in a state of constant development and improvement: a "permanent beta" state.