Collie & Associates

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Insights Into Employee Commitment, Productivity And Retention

By Joyce Gwilliam, Insights Vancouver

Overview

Employee commitment, productivity and retention issues are emerging as the most critical workforce management challenges of the immediate future, driven by employee loyalty concerns, corporate restructuring efforts and competition for key talent.  For many firms, “surprise” employee departures can have a significant effect on the execution of business plans and may eventually cause a parallel decline in productivity. This phenomenon is especially true in light of current economic uncertainty and following corporate downsizings when the impact of losing critical employees increases exponentially.

Research has recently shown that the primary reason individuals choose to leave their jobs is because of poor management.  This is true, even in top performing companies, says Dr. Barbara Kreisman, principal of a Denver-based consulting firm, Intergistic Solutions, which works primarily with organizations in transition. Dr. Kreisman, former Sr. Human Resource Strategist for Dell Computer Corporation, claims that poor manager-employee relationships impede productivity and often result in the loss of an organization’s key talent.

According to Dr. Kreisman, research shows that the working population can be divided into several categories: people who are engaged (loyal and productive), those who are not engaged (just putting in time), and those who are actively disengaged (unhappy and spreading their discontent).  Even in the “best of times”, (i.e. the late 1990’s), only 26 per cent of the working population was fully engaged in their work, she notes.  The rest of the population is either “not engaged” (55 per cent) or “actively disengaged” (26 per cent).

Dr. Kreisman, who conducted her doctoral research at the University of Texas-Austin on the subject of “Identification of the Drivers of Employee Dissatisfaction Leading to Turnover, further notes: “Productivity and retention rates generally fall further as employees become distracted, confused and preoccupied with potential outcomes immediately following an organizational transition such as a major restructuring, corporate downsizing, merger, acquisition, or even rapid growth spurt.”

Recent studies have shown that the manager, whether a front-line supervisor, a project leader, team ‘captain’, or senior manager, actually has more power than anyone else to reduce unwanted turnover.  This is because the factors that drive employee satisfaction and commitment are largely within the direct manager’s control.  These include providing recognition and feedback, the opportunity to learn and grow, fair compensation reflecting an employee’s contributions and value to the organization, a good work environment, and above all, recognition and respect for the uniqueness of each person’s competencies, needs, desires and style.

The Role of the Manager

In turbulent times, the role of the manager becomes more important than ever because managers play a vital and distinct role, different from anyone else in the organization, Dr. Kreisman contends. 

She cites research conducted by the Gallup Organization, which suggests that to effectively motivate and retain employees, a manager needs to deal with each person one at a time—asking questions of, listening to, and working together one-on-one.  A “good manager” therefore, is one who will help talented people find satisfaction in their work, and “satisfaction” is key to an employee’s decision to stay or leave an organization.

It must be recognized, however, says Dr. Kreisman, that over the last 10-15 years, most organizations have de-layered and eliminated many middle management positions.  Today’s managers often have large numbers of direct reports in addition to individual responsibilities of their own   Very few have the time to effectively make the emotional tie with their subordinates that is really effective.   

Through use of various tools and processes, the process of communication and understanding between manager and employee can be accelerated.

Managers and the Insights Discovery System

One of the best tools on the market today, according to Dr. Kreisman, is the Insights Discovery System which helps managers accelerate the process of identifying the ‘motivational drives’ of each employee. 

Key to increasing productivity is employee commitment and engagement.  “The Insights Discovery System is a complete suite of ‘tools’ which managers can use one-on-one with employees; in teams or with entire organizations”, says Dr. Kreisman who utilizes the system with groups and individuals within large and small organizations nationwide.

“Essentially, the Insights methodology provides ‘insight’ to an employee’s style of  communication, decision making capabilities, their value to a team and their way of interacting with others.  Based upon type, it also suggests how to best manage the individual as well as how not to manage him or her.”   Each person who takes the on-line Insights evaluator receives a 30+-page report with separate sections that can include information on their personal learning style, time and life management practices, and selling style.  This report is extremely beneficial for employees who want more information about themselves, and for their managers who need to know how to manage their employees.

According to Dr. Kreisman, the true potential of an organization is when the productivity level of all individuals and teams are fully aligned, committed and energized to successfully accomplish the goals of the organization. 

“This is difficult to achieve, but organizations that are successful doing so experience productivity gains of 30 to 500 percent.  It is clearly worth a company’s time and effort to ‘close the productivity’ gap by tightly integrating their business strategy with their people management philosophy”, she points out.

One of the unique elements of the Insights Discovery System is that it helps managers readily communicate with their employees about their strengths, blind spots, and barriers to effective communication. 

The Insights System is based upon the work of Carl Jung, considered the Father of Modern Psychology, and is the only personality-typing instrument “true to Jung’s research.  There are other personality tools on the market, most notably the Myers Briggs, but it was not designed specifically for use in organizations, and it is not true to Jung’s original concepts of personality typing,” says Dr. Kreisman, who is certified in both the Myers Briggs and Birkman Methodology, instruments that are sometimes used in companies today.

“Just l8 months ago, companies couldn’t hire enough people to handle the jobs that were available.  Now, the economic downturn has forced thousands of companies to cut back or downsize their employee populations.  In the past year alone, more than a million U.S. jobs have been eradicated leaving a scenario of lost trust, eroded loyalties, financial demise, growing employee cynicism and diminished productivity.”

Dr. Kreisman notes that “employee stress levels have escalated as morale and creativity plummet, while simultaneously, the cost of absenteeism and medical related expenditures have risen. Further,” she says, “companies are now indicating that product quality is beginning to suffer; customer satisfaction is dropping and many organizations are beginning to experience a significant increase in turnover of key talent--especially amongst those individuals considered most ‘crucial’ to the downsized organization.”

Managing Chaos

The manager creates performance in each employee by speeding up the reaction between the employee’s talents and the company’s goals, and between the employee’s talents and the customer’s needs.  When hundreds of managers play this role well, the company becomes strong, one employee at a time.  In today’s slimmed-down business world, most managers shoulder other responsibilities:  they are expected to be subject matter experts, individual superstars and leaders in their own right.  These are important roles which managers execute with varying styles and degrees of success, but when it comes to the manager aspect of their responsibilities, ”great managers” excel at motivating their people.

“What we’re faced with today, is an extremely dynamic and volatile work environment marked by continued turbulence in the economy,” says Dr. Kreisman, further adding: “Managers face a difficult challenge of motivating and retaining employees in an environment of increased uncertainties”.

So how can managers and organizations make sense of all this chaos?

Dr. Kreisman, who spent 10 years with Dell Computer, considered “one of the nations most respected organizations”, says research shows that in the future, successful organizations will be those which adapt their organizational behavior to the realities of the current work environment where longevity and success depend upon innovation, creativity and flexibility. Additionally, the dynamics of the work environment will have to reflect a diverse population comprised of individuals whose motivations, beliefs and value structures differ vastly from the past and from one another. 

Workforce Stability

“In today’s turbulent workplace, a stable workforce becomes a significant competitive advantage.  If an organization has unstable workforce conditions, it’s forced to invest thousands of dollars in recruiting, orienting, training, overtime and supervision.  “Those dollars come right off the ‘bottom line’”, Dr. Kreisman acknowledges, “Without continuity, organizations don’t have ongoing close relationships with customers; customer loyalty is fragile; managers are stressed; conflict is more likely; efficiency is hampered.  Such challenges make it difficult for an organization to compete in the marketplace.”

Arguably, the most valuable (and volatile) asset is a stable workforce of competent, dedicated employees, says Dr. Kreisman, noting: “Longevity gives a company a powerful advantage; depth of knowledge gives organization strength.  The loss of a competent employee is increasingly difficult to replace with someone of comparable competence—even with an effective succession planning process.  With a volatile labor market and competition for good people, organizations are forced to hire persons with less competence.  If this scenario repeats itself enough, the aggregate competence and capacity of the organization’s workforce will gradually diminish—along with the ability to meet customer expectations. Dissatisfied customers leave, and take the organization’s cash flow and profits with them. 

Important stakeholder groups (customers, creditors, investors, employees) watch workforce stability and capacity carefully.  Workforce strength, capacity, and dependability influence the confidence of all these constituents.

Customers are increasingly concerned about the quality and service levels they get from suppliers.  They want to have confidence that their suppliers can perform—especially in situations that call for specialized knowledge, fast response, or appreciation of the customers’ history with the company.  Customer relationships are stronger when an organization’s workforce is stable and customers can depend on the company’s people—the continuity of their product knowledge, industry experience and proven performance.

Unhappy people can seriously affect employee morale.  Whether they leave or not, disaffected workers can damage the attitudes of other workers, says Dr. Kreisman.   “Negative feelings impact the quantity and quality of work, absenteeism and tardiness, cooperation with supervisors, and a company’s ability to attract desired applicants.  Instability of the workforce, often caused by ineffective managers, can cause far-reaching problems.  When dedicated workers have difficulty getting their jobs done, they quite naturally look for other employment opportunities where they can achieve the satisfaction they seek from work.”

Measuring the cost of employee turnover can be a real challenge…and a real eye opener. 

Dr. Kreisman indicates regardless of what components are included in turnover calculations, it is clear that most business leaders have seriously underestimated the cost of turnover.  “Losing an employee, even a lower level one, often costs the equivalent of from six months to two year’s pay. Highly skilled technicians, professionals, and managers typically cost as much as twice that to replace.”

Why Good Employees Leave

When managers or supervisors are asked why good people leave, most respond by saying “its about money”, says Dr. Kreisman. “Or, they simply dismiss the departure matter-of-factly by stating that the employee “received a better offer”.  Managers often blame organizational policies or pay scales for the loss of talent.”

Contrary to expectations, research indicates that money is not even in the top five reasons employees give when asked why they are leaving an organization.  The way an organization distributes money indicates what management really wants however.  It sends a message to employees whether the company truly pays for performance; incentive plans indicate service or sales to customers; and an organization that pays and supports employee development will generously pay for academic and training courses.  Salary and benefits tend to attract people to organizations, but are not usually the reasons employees leave.

Commitment is Personal

Companies that are able to create commitment realize that commitment ultimately is personal.  “This is the hard part of commitment that has profound implications for corporate conduct—it requires being flexible and making exceptions, it requires being consistent in what a manager does even though there may be short term costs attached; and it requires making choices about what employees are prepared to do,” Dr. Kreisman notes.  “Commitment requires the patient and concerted effort of the whole organization.”

To build commitment, managers must communicate with employees; assess their  capacity to engage in various initiatives; give honest feedback; develop their strengths; identify their ‘blind-spots’; make decisions; and most of all, value each person’s unique style and capabilities. “The Insights Discovery System is very effective at doing just this,” says Dr. Kreisman.

In order for the relationship between manager and employee to be emotionally rewarding, it has to based on the things that individuals want and need; has to evolve and grow; and must enable the employee to feel effective in the execution of his or her duties.

Bottom line, it is the role of the manager, that most influences an employee’s decision to stay or depart from an organization.

For more information about how Collie & Associates can help your organization contact Charles Collie by phone: 804.730.5211 or e-mail: charles@collieassociates.com .