A Management Mistake During Tight Labor Periods

It's no surprise to anyone who has tried to hire someone in the past year that the labor market is incredibly tight.  The unemployment rate (percentage of people who are unemployed and looking for work) is historically low.  According to the Bureau of Labor Statistics, voluntary turnover in 2021 was 25% and that trend has extended into 2022. That means one of every four workers is changing jobs each year!

Managers and small business owners in all industries are scrambling to find and keep workers. There is one unintended consequence of this panic that managers should be cautious of. That is the tendency for supervisors and managers to tolerate behaviors and performance that they would not tolerate during periods when the labor market is not so challenging.  Some individuals who were C players even before the pandemic have responded to their new power position by becoming C- players. They used to come in late once per week.  Now they're late virtually every day.  They used to make a few mistakes per week, now they make a bunch.

The problem for managers who tolerate this lower level of performance from their most disengaged employees is that the more engaged workers see this and are demotivated by it. Too much of this can result in the A and B players leaving the organization.

The question managers should ask themselves is, "would I prefer to be short-handed with my best, most productive workers or be short-handed with only my least productive workers." The answer is obvious. Managers should not tolerate behaviors and performance during a tight labor market that they wouldn't in more "normal" times. They should address performance issues with those whose performance is slipping, encourage them to improved, and if they remain defiant, invite them to exit the organization. It'll hurt in the short-term, but they are more likely to keep their best talent in the long-term.

Best Boss I Ever Had

“Tell me about the best boss you ever had.”  This is a favorite interview question of mine as well as a conversation starter I use in training classes.  Since a lot of my training classes are with construction, trades and manufacturing front line supervisors, I often hear some version of this story:

 

My best boss was Bob.  He cussed me every day.  He would throw tools at us if we weren’t doing what he thought we should be doing...

 

I enjoy hearing their stories because I had a Bob or two in my early life as well.  When teaching new supervisors how to be remembered by their team members as the best boss they ever had, I dive more into what made Bob a great boss.  If my training is successful, they begin to understand that it wasn't the cursing or tantrums that made Bob a great boss, it was that he cared.  

Bob wouldn't be remembered as a great boss if his behavior was associated with selfish motivations - like making his own bonus or getting off of work early. They knew Bob yelled at them because he cared.  He cared about the quality of the product or service. He cared about the customer.  He cared about meeting deadlines. He would take time to teach them skills.  He genuinely wanted them to grow professionally.

Bob's behavior is no longer acceptable in the modern workplace (though it still exists).  The modern foreman or supervisor needs to remind him or herself that it wasn't the cursing that made Bob a great boss, it was the caring. The modern supervisor is challenged to hold workers to high standards of performance and coach them in their career development without using Bob's techniques.  The answer is learning how to have adult conversations with workers, even when they aren't acting like adults. 

Leadership Lessons from History

 As Black History Month comes to an end, we want to share our thoughts on some influential black leaders.

ROSA PARKS
She was small but determined. Rosa had the courage to stand up for her beliefs. She was jailed for refusing to give up her bus seat for a white passenger. Effective leaders should make the right decision – even if it is not a popular one.

GEORGE CARVER
He was a strong proponent of personal responsibility. “Ninety-nine percent of the failures come from people who have the habit of making excuses.” This profound statement from the notable agricultural scientist highlights the significance of integrity. The values of an organization flow from the top positions.

SARAH BREEDLOVE WALKER
This inventor and businesswoman created and sold her own brand of cream/shampoo in the early 1900s to ease the problem of itchy skin due to a lack of indoor plumbing. Her company trained thousands of African American women to sell the products in stores, through the mail and door-to-door visits. Ms. Walker knew the importance of employee recruitment and training.

JACKIE ROBINSON
As the first African American player in Major League Baseball, Jackie was ostracised by players and fans. His non-violent approach to the Civil Rights movement emphasizes the impact of leading by example.

URSULA BURNS
She holds the distinction of being the first African American woman to lead a Fortune 500 company. She was the top executive at Xerox from 2009 to 2016 in her role as CEO and chairwoman. Organizations thrive with strong leadership.

It is crucial to have the right people in the right roles for success. Organizations rely on the Davidson Group’s experience to hire and retain the right employees. We specialize in employee training and development.

What Employees Love

Companies should be motivated to promote a healthy work environment. Happy employees are more successful, productive and collaborative. They think more creatively and are not afraid to take risks. Below are some ways to create and promote a positive workplace through these Human Resources (HR) practices.

Training

We recommend that companies dedicate at least one week to training new employees. The HR manager should create a planned onboarding program. This can include shadowing colleagues, attending meetings, reviewing strategy documents and locating key internal documents. Don’t forget to review health and safety protocols. Ongoing training should be offered as needed on specific topics.

Regular Communication

Two-way communication is crucial for organizational success. Managers should set up a regular schedule to connect with their employees, and this should be done outside of operational meetings. These check-ins can be done via text, Zoom, a phone call or over coffee. The key is having dedicated time each week to discuss projects, ideas and challenges.

Clean Up

Time is our most valuable commodity. It is respectful to clean up after yourself. That means washing your coffee cup and putting it away. It also translates to replacing paper in the copier after running a big job. Employees should be mindful of sharing key documents and attending meetings on time. Mutual respect promotes a professional work environment.

Set Clear Goals

Success is achieved when performance and goals align. Each person should have clear work objectives. Clearly explain what key performance indicators (KPI) will be used to monitor their progress. Set regular times to evaluate KPIs, which allows for tweak to be made. A company should align the goals of the employee and their team to the organization. It’s important to communicate how personal and departmental goals support the mission of the company.

If you want ideas on how to improve the happiness factor in your company, contact HR expects at the Davidson Group.

Elevate your Annual Reviews

Many organizations do their annual evaluations in the first quarter. However, research shows that managers and employees dislike performance reviews. The fundamental aspect of any evaluation is COMMUNICATION. Let’s discuss some review processes used by organizations.

360-Degree Review
Feedback is gathered from a variety of levels (i.e. subordinates, colleagues and supervisor). The employee also provides input on their view of their performance.

Pros – This can allow an organization to develop employee behavior and improve employee relationships.
Cons – This feedback tool is not customized to the needs of the organization. Some question the accuracy of results.

Hay Job Evaluation
This process allows an organization to map out different roles. Aspects of each role and a score are reported in the long profile, while the short profile details the nature of the role (i.e. accountant or sales manager).

Pros – This process provides salary benchmarks. It creates clear job descriptions and improves succession planning.
Cons – Some argue this evaluation supports the values of traditional management. It should be conducted by a trained expert.

Performance Reviews
An employee’s performance is documented and evaluated by their immediate supervisor. Although they are usually done on an annual basis, some organizations are doing them more frequently to improve communication.

Pros – It can enhance employee focus, determine training needs and improve performance.
Cons – There is a significant time lag in work and feedback. There are negative views on this process due to its subjective nature.

There are numerous other types of performance evaluations used. Instead of a lengthy review process, teach your supervisors and managers to give timely feedback. 

Contact the experts at the Davidson Group for ideas on how to improve your review process for better employee performance. 

The Importance of Human Capital

Almost 60 years ago, Dr. Martin Luther King, Jr.  delivered his “I Have a Dream” speech on the steps of the Lincoln Memorial to a massive crowd. He spoke these words to Americans in 1963, and they are still relevant today. He dreamed of equality for all Americans. 

His timeless words align with the field of Human Resources (HR), which focuses on human capital. Let’s consider a few pertinent quotes from his moving speech.

 “When the architects of our republic wrote the magnificent words of the Constitution and the Declaration of Independence, they were signing a promissory note to which every American was to fall heir. This note was a promise that all men - yes, black men as well as white men - would be guaranteed the unalienable rights of life, liberty and the pursuit of happiness.”

While companies are not guarantors of happiness, they should be motivated to promote a healthy work environment. Happy employees are more successful, productive and collaborative. They think more creatively and are not afraid to take risks (i.e. think outside of the box). If you want ideas on how to improve the happiness factor in your company, contact our HR experts.

 “We refuse to believe that there are insufficient funds in the great vaults of opportunity of this nation.”

Companies should carefully consider their goals and dreams for 2021. It’s important to ensure that your employees are using their time to achieve these strategic goals. However, employee retention and engagement are not often measured. Companies rely on the Davidson Group for employment practices that create a work environment to support your company’s mission and values.

 “So even though we face the difficulties of today and tomorrow, I still have a dream. It is a dream deeply rooted in the American dream.”

Successful companies support the American dream by providing a work environment where their employees can succeed based on hard work. The Davidson Group provides custom training, so your company gets focused attention on specific topics for maximum impact. 

"I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character.”

Organizations want the best employee for the job. Racial equality is promoted by Title VII, which prohibits racial discrimination in applicant recruitment, candidate selection and employee retention. Our assessment process will ensure your HR practices are compliant and robust. 

For your HR solutions, contact the Davidson Group by calling 336-294-5053.

It's a Great Time to Look at Total Compensation

Unemployment rates are at or near historic lows in many communities. Companies who hire low-skill workers at the bottom of the wage scale are scrambling to find dependable workers and to figure out ways to differentiate themselves from competitors in the labor market so that they can retain the better ones. 

We've seen rates drop from over 11% to rates in the 4-4.5% range since 2010. I'm old enough to have experienced these drops several times during my career. Each time, as the economy heated up during an economic recovery and unemployment rates dropped accordingly, the quality of candidates dropped noticeably as well. Individuals with recurring drug problems, criminal background issues and an obvious poor work ethic really stand out when the unemployment rates get low. It seems like there are more of them during boon times, but they've really always been there. Their numbers were simply diluted when there were more good workers in active job search.

On the positive side for employers, there is still a lot of movement among lower wage workers as they shuffle to find that employer they plan to call home for a while. As an outplacement consultant told me one time, Sometimes you have to take "a" job before you find "the" job. That's where many of them are. They're employed, but they're open to a better opportunity. Here are some tips to become that employer of choice:

1. Have an employee referral program in place. This program shouldn't have a big expense associated with it. You just need a way to say thank you to your employees who are willing to tell people in their circles about opportunities at your place. Paid-time-off is one of the most popular incentives. Sometimes owners outsmart themselves by insisting on a cash incentive, like $250 to 500, when a much less expensive non-cash benefit, like a full or half-day off with pay, would be preferred by an employee.

2. Consider weaning off of temps. Temps are a great way to ramp up operations and a good, reputable temp agency is a wonderful partner for any business that experiences peaks and valleys of demand. However, as long as a worker is an employee of an agency and not of your organization, they are likely to feel and act like an outsider. Take some time to calculate what your core workforce needs to be for the foreseeable future and set a goal to staff to that level with employees of your organization. When you identify good workers among your agency workers, bring them on-board when your contract will allow it, and make a big deal about it.

3. Look at your total comp.  Determine if your starting wages for entry level workers is competitive.  And remember, you're not just competing against people in your industry.  You're competing against every industry that hires workers with similar skills to what you're looking for. Then look at your benefits package as compared to what others are offering.  Commercial health insurance agencies are a tremendous source of information regarding benchmarks.  Consider conducting an employee survey to see if the benefits you are offering match what your employees (and the employees you are trying to recruit) actually want.  It may make sense to drop one benefit and replace it with another that they value more.  Look at your paid-time-off policies. This is a highly valued benefit that many smaller companies overlook. And finally, find ways to reinforce what their total compensation really is - whether it's total compensation statements or putting up graphs at an annual employee meeting - remind them of all the things you provide in addition to their net wages.

4. Have an on-boarding plan.  Employees experience buyer's remorse just like consumers do. The best way to fight buyer's remorse with new hires is to have a detailed plan for new that includes the first day, week, month, quarter or longer, depending on the position and responsibilities. Sometimes managers are so relieved to have a spot filled and the box checked, they forget to do the little things to ensure that the person gets fully socialized and engaged in the company and in their job. Seeing that the person is fully grasping their job and being (and feeling successful) and that they are making friends at the workplace is critical. If you want that new hire to still be around a year from now, don't let this part slip.

While some companies in some industries can be successful using what is essentially day labor - a revolving door of temps and new hires - most will improve their bottom line by building a stable workforce of engaged workers who are, and feel, like they are part of something.