Gallup Research says: 29% of a company’s workers are engaged (your ‘stars’); 54% are disengaged (your ‘so-so’s') and 17% are ACTIVELY disengaged (your ‘passengers).

So what? It is estimated the ACTIVELY disengaged employee wastes 2.5 hours per day, EVERY day. At $20 per hour, that person is costing you $50 per day. On an annual basis, they are costing you $11,000, mininum.

What if your company is ‘average’ and 17% of your work force are ‘passengers’, what is lack of engagement costing you?

Are your employees engaged? The results of a recent survey at  a company with 33 employees (“we’re small, we’ve got a handle on our employees; it’s the big companies at that are at risk”) surprised the owner when he found out more than 50% (17) of employees that were either ‘so-so’s’ or ‘passengers’…..MORE THAN 50%! (and he thought he was OK….YIKES!)

So what can you do? There are many different tools that can measure your employees engagement. If you would like some help finding the best solution for your situation, I will be happy to assist….just send me an email (and we’ll avoid ‘tele-tag’).

Regards,

Dave

PS: If your are coming to NAMA at the end of the month and would like to meet for a cup of coffee, let me know!
DHM.

In late 2009, WorldatWork reported a Right Management survey of more than 904 workers in North America asked: Do you plan to pursue new job opportunities as the economy improves in 2010? The answers are startling:
60%—Yes, I intend to leave: 21%—Maybe, I’m networking: 6%—Not likely, but I’ve updated my resume: 13% — No, I will stay.

Douglas J. Matthews, president and COO at Right Management. “Employees are clearly expressing their pent up frustration with how they have been treated through the downturn. While employers may have taken the necessary steps to streamline operations to remain viable, it appears many employees may have felt neglected in the process. The result is a disengaged and disgruntled workforce.”

Matthews said that the best workers are mobile in any economy. “We know that people are attracted by career development opportunities, attaining work-life balance and working for an innovative company culture. If management doesn’t provide employees with these opportunities, then workers are going to take their knowledge and skills elsewhere. Talented staff can change jobs because they can and want to, not because they have to.”

So….which of your team will get happy feet and head out the door the first chance they get?

If you do not have an idea of who is engaged and who is NOT engaged at your company, might be a good time to put some time, talent and treasure against the potential issue.

There are many ways to measure engagement; if you would like to discuss, let me know.

Happy Daze to all!

Mac

*WorldatWork; The Total Rewards Association, November 2009

Do you do REviews or PREviews at your company?

Are you still trying to predict the future from past performance?  How is that working for you? 

You look back and see ALL that happened, but you don’t know WHY it happened, right?   

• Performance REviews: see only what happened yesterday, not why.

• Performance PREviews: see what will happen tomorrow, based on an employee’s skill set today.

The Wall Street Journal says “Instead of stimulating corporate effectiveness, they [performance reviews] lead to just-in-case and cover-your-behind activities that reduce the amount of time that could be put to productive use”

Managing employee performance is like trying to catch water with a sieve.  

A REview of past performance is no indicator of future success.  Rather, it usually finds there were (or may still be) performance shortfalls that caused objectives to not be met.  The REview does NOT tell you  WHY the objectives  are not being attained or, as important, how performance might be improved to help attain the objectives.    

Today all operators have the capability to do Performance PREviews.  These are appraisals that CAN affect future performance because they show WHY an employee may be lacking in performance.   

Some PREviews include Coaching Reports for employees (think instruction manual for EVERY employee) that identify strengths and growth opportunities, not a REview of past results.

For more information on PREviews vs. REviews, comment or raise your hand on this blog, and I will help find the best solution for your company.

Stop looking backward; ……..Start looking forward! 

Happy Holidays to all!

Dave McCaffrey

The study (360,000 employees over 20 years in 14 industries) concluded the factors that cause a person to fit their job are how well the respective person matches the needs of each job with regards to: mental capabilities, behavioral traits and occupational interests.

As we all know, success in any job is related to how well the person does the job.

However, the measurement of success in any job (sales volume and/or profit are commonly used measures along with inventory value, orders filled completely, etc) does not tell us WHY someone was successful or not, they just tell us IF the person was successful or not.

How well any person does in any job is DIRECTLY related to the learning skills required by the job, the behavior necessary in that organization, and the interests needed to stick with the job COMPARED to the capability of the respective employee.

In most companies, top performers have more productivity (at least 60%) and less turnover (up to 300% less) than average workers. Thus the connection between Job Fit and productivity and turnover is clear: the better the job fit, the higher the productivity and the lower the turnover.

Since top performers capabilities CAN be measured with regards to learning, behavior and interests in any job, a job pattern can be established that indicates what the job requires. Once the pattern is established (every job in every company is UNIQUE), potential candidates (or struggling incumbents) can be compared to the pattern to determine job match.

If a high job match is present, productivity goes up and turnover goes down because the employees LITERALLY fit their jobs.

If a low job match is present, productivity goes down and turnover goes up because employees can’t do the job (mental), can’t do the job the right way (behavior), or won’t do the job (lack of interest).

Unfortunately, an interview is the most common hiring process toda, which finds a top performer less than 15% of the time. In other words, the process fails to find the top performer you are looking for more than 85% of the time. Talk about a dysfunctional process!

If you are coming to St. Louis for NAMA National in mid October, I would recommend you plan to check out the HOT TOPIC presentations that are presented during show hours at the main NAMA both. You can be face to face with experts that CAN help your business, and ask them the questions you always want to ask….but never have the chance.

Coming next quarter: How your hirning process impacts your bottom line!

“See you in St. Louis, Louis”…..travel safe!

Sincerely,

Dave McCaffrey

Rather than serving as opportunity for providing direction, growth and alignment, Performance Management is more often seen as a necessary evil.  An Aberdeen Group study indicated there is clearly a disconnect between the concept of performance management and it’s successful execution, since 95% of study reported giving performance reviews but only 11% felt the reviews actually improved performance levels.

In our June post we discussed the two key performance criteria that defined ”Best in Class” Companies with regards to performance management:

1. Improved bottom line results: best in class companies experience a minimum profitability growth of 10% or move over last 12 months.
2. Increased employee retention rates: 94% of best in class companies increased or maintained stable employee retention rates over the last 12 months.

This quarter, we would like to discuss WHY focusing on performance management is seen as more important a project than ever.

According to Aberdeen, industry pressures are forcing all companies to adapt to change in two primary elements of their business.  First, the labor pool is shrinking and second, the pressure to perform more profitably is unceasing.

The study show the top five (5) pressures driving performance management within a company were:

1. Pressure to improve overall company performace indicated by 57% of group.

2. Pressure to improve employee productivity indicated by 46% of group.

3. Pressure to increase employee satisfaction indicated by 31% of group

4. Pressure to gain visibility of goals, metrics and ratings indicated by 30% of group

5. Pressure to add structure to the process indicated by 20% 0f the group.

Key takeaway?  Employee Performance Management used by best in class companies as method to increase company performance.

Key disconnect? 31% of group indicated they were dissatisfied with their Employee Performance Management Solution.  Bottom line? The review process is anticipated by both managers and employees with a great deal of dread and trepidation. 

 Aberdeen’s study showed:

• Best In Class:  in the top 20% of companies, 94% improved employee retention and 88% increased profit at least 15%.

• Industry Average: in the middle 50% of companies, 74% improved retention and 4% increased profit at least 15%. 

• Laggard: in the bottom 30% of companies, 59% improved retention while 0% increased profit at least 15%. 

Key Takeaway?  Companies that successfully use Employee Performance Management are much more likely to retain more employees, leading to significant profit growth. 

The key to success?  Hire employees that fit their jobs, and make sure they are capable of doing the job, doing the job how you want it done, and being interested in doing a good job.

 Coming next Quarter: What IS the connection between productivity, turnover and job match?

Thank you for taking the time to read about Employee Performance Management.  Your employees are your company’s largest asset; with workforces shrinking, employee retention will be key factor impacting success of any company.

Hope to see you in St. Louis at NAMA National October 15-17, 2008. 

 Sincerely,

Dave McCaffrey

While it’s terrible that almost half of high performers are thinking about quitting, what’s perhaps even worse is that low performers want to stay.  Only 18% of low performing employees are actively seeking other jobs, and 25% of middle performers are actively looking around.  (DHM note: why would they be seeking other jobs; they’ve found a home! They have figured out how to stay below the radar and collect a check for minimal contribution.  How long can you afford non revenue producing employees that usually make up 80% of your total workforce?). 

 Leadership IQ surveyed 16,237 employees on a range of workforce and retention issues, and then divided them into high, middle and low performer categories based on their annual performance appraisal scores.  There were 3,896 employees identified as high performers, 8,607 identified as middle performers, and 3,734 low performers. “High performers keep companies in business,” says Mark Murphy, CEO of Leadership IQ, “so every company is at risk if these people leave.  If you lose some low performers, you might actually be better off.  But when your best people quit, revenue drops, quality suffers, and snafus increase.  Even large companies can take a big hit with the departure of just a few key employees.” 

Murphy continues “The worst part of this is that we typically cause our high performers to quit by how we treat them.  Frankly, we treat our high performers worse than any other employee.  When a manager has a tough project upon which the whole company depends, to whom do they turn?  Who gets the late hours and the stress?  It’s not the low performers, because managers want the project done right.  Instead managers turn to their handful of high performers.  Over and over we ask our high performers to go above and beyond, making their jobs tough and burning them out at a terrible pace.  Meanwhile, low performers often get easier jobs because their bosses dread dealing with them and may avoid them altogether.”

So what can you do to keep your top performers happy?  Make sure you know WHY they are your top performers, not just that they are….because of sales or collections or new business. 

If you understand WHY your top performers do what they do, you can improve performance of your middle and lower groups, reducing strain on top performers while improving profitability and reducing turnover. 

The old adage…..”you cannot manage what you cannot measure”….has never been so true as it is when talking about improving performance.  There ARE tools available to help you make sure you retain your top performers and improve the rest of your team at costs FAR less than replacing a top performer…or paying a full salary to a low performer that is a non-revenue expense. 

Your employees are your company’s single most important asset: are you investing in them as much as your other assets?  If you want to be around tomorrow, investing in employees today is a good bet!

Rather than serving as opportunity for providing direction, growth and alignment, it is more often seen as a necessary evil.

The Aberdeen Group surveyed over 600 individuals: while 95% indicated conducting regular performance reviews, only 11% indicate satisfaction with the process in their organization.  There is clearly a disconnect between the concept of performance management and it’s successful execution. 

Aberdeen reported that two key performance criteria defined ”Best in Class” Companies (BiC) with regards to performance management:

1. Improved bottom line results: BiC companies experience a minimum profitability growth of 10% or move over last 12 months.
2. Increased employee retention rates: 94% of BiC companies increased or maintained stable employee retention rates over the last 12 months.

Coming in future postings:

• What are top five (5) pressures driving performance management?
• What are strategic actions necessary to achieve performance management goals?
• What is the connection between productivity, turnover and job match?

Have a great week; back to you soon!

Sincerely,

Dave McCaffrey

PredicitiveAssets

(866) 584-9551 (toll free)

1. Their learning skills (verbal and numerical capability) may not match those required to do their job: 

> If their learning skills are lower than required, the employee may literally not be able to do their job properly. 

> If their learning skills are higher than required, the employee may have communication problems or become bored with their job. 

2. They may not have the necessary unique behavioral traits required to do their job.  In other words, they may not fit into the culture of the job at your company.  

3.  They may not have the occupational interests that match those required by their job.  If their interests do not match those needed by their job, they will lose interest and become disengaged.    

There is a management axiom that says: “you can’t manage what you can’t measure’. 

Given that most current measuring standards are based on functional results (sales, profit, returns, etc) that are historic (they tell you what happened yesterday, not what will happen tomorrow), the scale to which an employee is being measured may not have anything to do with the employee’s success….or lack there-of in a job function.

To be able to manage your employees in a predictive manner, you need to be able to measure their learning skill, behavioral traits, and job interests.  Once you have assessed what may be causing their sub par performance, you will be able to manage that employee to increased productivity. 

I hope this information helps improve productivity and reduce turnover at your company.  Please let me know if you have any questions.

Sincerely,

Dave McCaffrey

profiles@predictiveassets.com

866 584-9551 (toll free)

Engineers, Machinists, Tradesmen in Short Supply

Because of an aging workforce and a new generation of workers entering other professions, engineers, machinists and skilled trade workers are the three most difficult positions to recruit for, according to Manpower’s annual list of “The 10 Hardest Jobs to Fill.”Baby boomers are starting to retire, which means many workers with traditional blue-collar skills are leaving the workforce, says Melanie Holmes, vice president of corporate affairs for the Milwaukee-based staffing giant. The survey, released Tuesday, April 22, covered 42,500 employers from 32 countries.The retiring boomers are compounded by fewer young people entering these fields. Less than 10 percent of college students in America are getting engineering degrees, Holmes says.The 10 Hardest Jobs to Fill are:

1. Engineers

2. Machinists/machine operators

3. Skilled trades (your Route Drivers?)

4. Technicians (your Machine Technicians?)

5. Sales representatives

6. Accounting and finance staff

7. Mechanics

8. Laborers

9. IT staff

10. Production operators

Technicians, sales representatives and accountants/finance staff also made it onto Manpower’s list.

Employers struggling to fill these vacancies can, in the short term, enhance recruiting efforts on college campuses and at technical schools and also emphasize the retention of older workers.

Longer term, Manpower suggests, employers should partner with local educational institutions and encourage students to enter these professions.

Nearly 25 percent of employers say they are having problems filling positions because of a lack of talent.

“Employers need to do everything they can to give opportunities to everyone who is willing or able to work,” she notes. “This includes the aging workforce, the younger generations, people of color and people with disabilities.”

Successfully recruiting young workers will depend on how well companies can cater to their specific needs. “This generation wants flexibility, they want to be innovative on the job,” Holmes notes. “And they want to have fun while they are at it.”

To minimize the impact on your company,

PredictiveAssets suggests you:

1. Modify your employment profile: Focus on learning skill, behavioral traits and occupational interests as opposed to education and experience.
2. Broaden your employment profile: Establish core competencies for all jobs in your company. Compare all applicants to all job functions, not just the one being applied for today.
3. Utilize accurate selection tools: Tomorrow, more than ever, you cannot afford to make a bad hire; use all available resources
4. Become an employer of choice: Job fit is much more important than compensation; do you have good job fit for all personnel at your company?
5. Finally, use broader advertising tools (i.e. CareerBuilder or similar online services) instead of local tools: a qualified applicant might be moving to your market next month!

For information and/or assistance with finding, selecting, hiring and developing your workforce, contact Dave McCaffrey at profiles@predictiveassets.com or 866 584-9551 (toll free).

Hope to hear from you soon!

Regards,

Dave “Mac” McCaffrey