Turning Your Employees Into Owners
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In a recent post ( “I Practice Age Discrimination; I Don’t Hire Anyone Under 40”) I talked about differences in professional attitudes and priorities between generations. I called the misunderstandings that develop a culture clash. But these different professional cultures did not come out of nowhere, and understanding why younger workers do what they do is key to building a company that can bridge the generation gap.

The Boomer Perspective

When I was growing up, I learned that if I got a good job and if I kept my nose down and worked hard, then I could look forward to a long and rewarding career. When I noticed colleagues from younger generations coming to work with a different attitude, I admit I problem with it.

Gen Xers wanted to go home at 5 pm whether the job was done or not. They didn’t seem like team players to me. Millennial employees wanted flex time and assumed their supervisors should act like coaches. I’d always thought that you either take a job or you leave it—you don’t tell your boss how you want to be supervised. It was hard for me to realize that my expectations were not their expectations, and that their expectations had merit.

My professional expectations and priorities reflected the economic reality of my youth. Income disparity was relatively small, the economy was growing, and there was opportunity everywhere for those who wanted it. People from younger generations grew up in a different reality.

Millennial Economics

Rightly or wrongly, people who came of age around the year 2000 have a reputation for being both demanding and idealistic. They want meaningful work, interesting coworkers, flexible hours, and supervisors who act like coaches, but they also expect to change jobs frequently. But many Millennials aren’t actually being demanding—the economic reality is that the rewards for hard work that I looked forward to just aren’t widely available anymore. So today’s young people look for different incentives.

The last twenty years or so have seen employers rely increasingly on temp positions and contract work. Real wages have fallen against inflation in many industries, even as the cost of getting an education has risen. The result is a widening gap between the those who can attend the best schools and graduate with a lot of opportunity and a much larger group who graduate deeply in debt, with no immediate prospects for long-term employment.

The reality is that this second, larger group of Millennials don’t expect to be able to earn a gold watch for twenty years of service to a single firm—they are lucky to stay anywhere for five years. They look for rewards they can access now, such as a meaningful work experience and the coaching they need to compete successfully in an extremely tight and fluid job market.

Bringing It All Together

The Millennial approach to professional life is, in part, an intelligent response to a tough economic situation. The employer who recognizes this fact has an opportunity to compete well for top talent, not just by providing the perks many Millennials look for, but by being the kind of company this generation has learned not to bother looking for. That means not just expecting hard work, dedication, and loyalty but offering it, too.

Give a Millennial a reason to stay, and he or she just might stick around and earn that gold watch.

Key Takeaways

  • Millennials approach work differently than older employees because they are beginning their careers in a different economic reality.
  • Millennials often look for “extras,” like coaching and flex time, because they don’t expect more traditional rewards, like good pay or job stability.
  • Employers who understand where Millennials are coming from are in a better position to compete for top talent.

I had a client say that to me recently—that he won’t hire young people. He thinks most people in the Millennial Generation are lazy brats. He’s wrong, but discrimination against the young is legal in most states, so it’s his prerogative. But what’s he going to do a few years down the road when Millennials dominate the workforce? If he can’t learn to adapt, he’ll watch all the top talent go to work for his competitors.

People from different generations approach work differently. It’s a kind of culture clash. In subsequent posts I’ll talk about where some of these differences come from and how business owners can attract and retain good people from all age groups. For now, let’s look at what these groups are and how they work.

The Baby Boom

This is the generation of most business leaders today—and almost a third of everybody in the workforce. Many older Boomers are actually retired or semi-retired, but there were 71 million people born between 1945 and 1964, so there are still a lot of them on the job.

If You’re a Boomer, then You Probably…

  1. Were raised to work hard, to be loyal to your employer, and to expect their loyalty in return.
  2. Were raised to expect to work in the same field, for the same company, for most of your adult life.
  3. Want an employer who appreciates your hard work and rewards you financially for it.

 

Generation X

These are the children of the social upheaval of the 1960’s and 1970’s. They also came of age during a recession. They’ve often been derided as selfish, cynical, or apathetic, but really a lot of them are just cautious—they need a safety net for themselves and their families. Gen X is small, but none have retired yet, so they form nearly a third of the workforce, too. As a group, they are notably well-educated.

If You’re a Gen Xer, then You Probably…

  1. Work hard during work hours, but go home at quitting time, because you, too, deserve a life.
  2. Want a job where you can further develop your skillset—you know you might get laid off at any time, so you want to be able to land on your feet and get a new position as soon as possible.
  3. You don’t feel much loyalty to your boss, but you don’t expect to be taken care of, either. You’re self-sufficient.

 

The Millennials

Millennials get their name because they came of age around the millennium. They’re also called Generation Y. They’re technologically savvy, often idealistic, but without any illusions about financial success. They might despair of ever paying off their college loans, but they fully expect to change the world.

If You’re a Millennial, You Probably…

  1. Don’t expect to stay anywhere very long or get paid very well—two years at the same job is actually a pretty good run. But you do expect fun, meaningful work.
  2. Want a boss who can act as your mentor or coach, as well as a collaborative, creative work environment
  3. See your job, ideally, as a way to further your personal mission. So you’ll definitely stay up till midnight answering work emails from home or telecommute from your own vacation if it helps the cause. But you also see no reason why you shouldn’t check your social media accounts from the office—work is part of life, so life is part of work.

 

Bringing It All Together

From the perspective of a Baby Boomer, a Gen Xer who insists on going home at five o’clock (even if a deadline is looming) looks selfish and a Millennial checking Facebook at work looks bratty. But the Gen Xer has kids to pick up from daycare and the Millennial will happily answer work emails from home. Both bring their own expectations and gifts to the workforce, just like Baby Boomers do. They’re just different.

Baby Boomer business leaders don’t have to adjust themselves to the changes that younger generations bring—but they don’t have to stay in business, either. Keeping up in today’s business world means finding a way to bridge the cultural divide between generations.

Key Takeaways

  • Each generation expects different things from employers and each offers different things. All can be excellent employees
  • Business leaders need to adapt to changes in workforce expectations
  • Leaders who tell younger workers to take it or leave it will find themselves left behind.

As CEOs, we often find ourselves pushing for change. We believe our organizations must constantly grow or else stagnate, shrink and die.  And you want to provide a dynamic, vibrant, and expanding organization that people will want to join. So as CEO’s, we’re restless. We’re constantly looking for opportunities to expand our reach.

But as a company grows, it gets exponentially more complex, putting more pressure on the middle managers.

Sometimes we try to protect our colleagues from the extra work. Sometimes it just seems faster and easier to do it ourselves. But if our people don’t get opportunities to develop new skillsets, they won’t be able to keep up as the company grows. Eventually, they’ll become a drag on the business if we don’t let them go–but these might be loyal employees of twenty years’ duration.

As CEO’s, we have to do what’s best for the company, but we also have to do it in an honorable and ethical.   A generous payout or a transfer to a more appropriate position might help take the sting out, but there’s no really great way to let a good person go. The honorable thing is not to create the bad situation to begin with.

As a CEO, your job is to coach and develop your team, not to run with the ball yourself. Sometimes that means delegating and teaching. Sometimes it means sending someone out for formal classes or to get a bachelor’s degree or an MBA. By proactively offering opportunities for middle managers to step up, you ensure you won’t outgrow loyal and capable employees.

Key Takeaways

  • Real leaders get things done through other people; they don’t jump in to the nitty-gritty work themselves.
  • When you delegate responsibility, you give others an opportunity to develop as professionals.
  • Not all bad situations have good solutions. By thinking ahead, you can avoid the problem in the first place.

 

Most new businesses fail–mine could easily have been one of them. Obviously I survived, but I learned a lot of valuable lessons from my close calls and you can, too. And you don’t have to repeat my mistakes to learn from them.

  1. I Bit off More than We Could Chew

On our first strategic planning retreat we got a little too motivated. We wanted to improve our organization’s ability to perform, so we agreed upon 13 different strategic goals. We meant well, but we couldn’t do it all at once. We were setting ourselves up for failure without realizing it.

Fortunately, we were able to realize the problem in time to course-correct and re-focus on just a few key areas. Once we completed those, we were free to give our full attention to our next set of strategic initiatives.

  1. I Tried to Do Everything Myself

In the beginning, I tried to facilitate our strategic planning meetings myself. I was concerned about cost and I felt I could be more effective than any outsider.

I ended up so busy facilitating that I couldn’t fully participate in the conversation—yet the other team members felt disempowered because I was talking so much.  When I finally hired an outside facilitator I was free to really get involved. Because I could talk less, the others felt free to get more involved, too.

  1. I Almost Stuck to the Plan—When Circumstances Had Changed

In the mid-to-late 2000’s we were experiencing explosive growth. We decided to put our strategic plan on hold for six months to focus on serving our clients. We almost didn’t make this decision—and that would have been catastrophic because we wouldn’t have been able to perform either task well. As a CEO, sometimes you need to be that leader and make tough decisions about how your team spends its time.

  1. I Trusted Our Memory Too Much

I remember during the first strategic planning meeting feeling very clear about what we had discussed and what we wanted to do. Then, over the next five or six months, that clarity faded. Some of our written goals started to just seem like something unimportant we had to check off. Others changed in our minds until we were off-track without even realizing it.

Eventually, I realized we had to revisit the plan a week or two after the retreat to make sure it really said what we meant—and make sure that the wording left no ambiguity that could lead to confusion or mission-creep later on.

The Bottom Line?

All of these early mistakes involved not really understanding my limitations or those of my colleagues and employees. I was inexperienced and overconfident—confidence is good, and it’s one of the reasons many of us are successful in the first place, but not when it leads to potentially dangerous mistakes. The fact of the matter is success does not come from enthusiasm alone. You also need to know what resources and abilities you have available and what your current situation demands—and does not demand. Learning how and where to invest your energy, and that of your colleagues and employees, is part of your role as a business leader.

Key Takeaways

  • Less is more – work on only 3-5 strategic initiatives at a time
  • Don’t be “penny wise, pound foolish” – Do not hesitate to hire outside help when you need it
  • Everybody plays – do not dominate discussions. Give others plenty of room to speak.
  • Don’t confuse the urgent with the important – Your job is to prioritize, even if that means setting aside important projects when the situation changes.
  • Always review written goals after the fact, to be sure the wording is clear and unambiguous for everybody. Do not trust yourself to remember what you meant six months later.

1.   “Don’t wish it was easier, wish you were better. Don’t wish for less problems, wish for more skills. Don’t wish for less challenge, wish for more wisdom.”

2.   “The challenge of leadership is to be strong, but not rude; be kind, but not weak; be bold, but not a bully; be thoughtful, but not lazy; be humble, but not timid; be proud, but not arrogant; have humor, but without folly.”

3.   “We must all suffer one of two things: the pain of discipline or the pain of regret.”

4.   “Days are expensive. When you spend a day you have one less day to spend. So make sure you spend each one wisely.”

5.   “Discipline is the bridge between goals and accomplishment.”

6.   “If you are not willing to risk the unusual, you will have to settle for the ordinary.”

7.   “Motivation is what gets you started. Habit is what keeps you going.”

8.   “Success is nothing more than a few simple disciplines, practiced every day.”

9.   “Don’t join an easy crowd; you won’t grow. Go where the expectations and the demands to perform are high.”

10. “Learn how to be happy with what you have while you pursue all that you want.”

My good friend Jim Koetting shared the above with me.  Thank you Jim.

I posted recently about planning for disaster and how to take care of our colleagues and their families in a crisis. Now I want to talk about another aspect of contingency planning—making sure our businesses survive.

One of the things we have to do as business owners is to think about “what-ifs.” For example, what if our office is destroyed in a storm or a fire?  What can we do now to minimize the damage and protect the business from disaster? The emergency plan that works for me won’t necessarily work well for you. Each company is different. You get to consider the advantages and disadvantages of all your options so you can draft a plan that will work for your particular situation.

Have Secondary Locations

Disasters, natural or otherwise, can wipe out a business. We had a client who went through Katrina and lost everything. A secondary location, complete with copies of all important records, can be critical.

Unfortunately, some disasters take out multiple locations. That actually happened to friends of mine. Their primary location was in New York and their secondary location was in New Jersey. Superstorm Sandy took out both.

Back Up Your Business in the Cloud

The cloud—distributed online storage—makes an attractive place to back up your data and IT systems in the cloud. The cloud is not vulnerable to local disasters, and you can access it from anywhere, so if your office is destroyed you can still get a hold of your information.

But I still like to have back-ups I can put my hands on. It is possible for a whole region to lose internet access (as happened to North Korea a while back). And of course, if your business depends upon specialized equipment, the cloud can’t help. Again, there is no one-size-fits-all solution.

Rent an Emergency Office

If you save your data, but lose critical office equipment, you still have options. There are companies that specialize in providing office space in emergencies. One of these is Agility, which is owned by General Electric. Within twenty-four hours they can bring in mobile offices with work stations and Internet. They can make arrangements for portable toilets, fresh water, portable generators, and things like that. And it’s scalable—if you just need a few computers, they can do that, too.

Plan for the Expected—and the Unexpected

If my office is destroyed by an earthquake, it won’t be a complete surprise; I work in an earthquake zone.  Tornadoes are an obvious risk in Missouri, and Florida needs to watch out for hurricanes. It just makes sense to prepare for whatever kind of problem is most common in your area.

But unexpected disasters happen, too. We don’t usually think about major earthquakes in Wisconsin or tornadoes in Nevada, but it has happened. It’s important to be flexible enough to prepare for anything that can come down the pike.

Wrapping Up

I recognize that you could spend a lot of time thinking about all this stuff, but the reality is if you get even 80% of the way there you are better off than most. As long as it doesn’t make you over-confident or complacent, a bad plan is usually better than no plan at all.

The main thing is to think about options. We tell our kids to meet outside if there’s a fire and we need to apply those principles to our business world also. We need to have a plan on the shelf that’s been tested and that’s ready to roll.

Key Takeaways

  • Ask “what if” and prepare for worst-case scenarios.
  • Take advantage of options like cloud storage and emergency replacement office services.
  • Develop a flexible disaster plan that will work even if the completely unexpected happens.

Many CEOs try to hand-pick a successor based on some personal idea of who would be good for the job. Sometimes the choice works out well. Sometimes it doesn’t. But the truth is that great leaders are found, not anointed.

I recommend using the strategic planning process to identify the people with the will and ability to lead.  When you assign responsibility for different strategic goals, do not tap people based on their titles alone. Instead, give those who show potential the opportunity to prove themselves.

Letting potential leaders prove themselves also gives your candidate the chance to earn the trust and respect of their peers. Then, when you decide to give someone increased responsibility, the others won’t feel left out or passed over. They understand the decision and they can see that the person earned the new position.

If someone has the will but not the ability, then you can teach them how to do the job. If they have the ability but not the will, sometimes you can motivate them. But do not try to groom someone for promotion who shows neither the ability nor the will. Find another candidate to help you achieve the goals and objectives of your organization.

In the end, this gets back to something I’ve been saying, directly or indirectly, in most of my posts; great businesses rely on the talent, resources, and innovations of the whole team. Your job as CEO is to develop leadership wherever you find it and let the cream rise to the top.

Key Takeaways

  • Choose a successor based on demonstrated will and ability.
  • Use the strategic planning process as a way to empower new leaders and let them prove themselves.
  • You can train the willing and you can motivate the able, but those with neither ability nor willingness you should let go.

Your company works because of the business savvy and institutional knowledge of everyone on your team. To successfully transfer your business to new leadership, you have to transfer that knowledge. The tricky thing is that not all of the magic resides in your brain—everyone who works for you, regardless of position, has a piece of the puzzle.

So, how do you find and document all the information the future leaders need?

Employee surveys, customer surveys, and full SWOT analyses (“SWOT” stands for Strengths, Weaknesses, Opportunities, and Threats) can only take you so far. These are all important parts of the strategic planning process, but I’d like to suggest doing something different as well.

Instead of just collecting information and analyzing it with your central leadership team, really talk to people—and listen. Listen more than you talk, so that your employees feel empowered to speak freely. These conversations give you an opportunity to get the perspectives of others so you can develop a holistic understanding of the company together.

This process–gathering information, exploring and sharing different perspectives, and then organizing and prioritizing the results—should sound familiar; it is the foundation of good strategic planning. It is also a great way to gather the information your successors need to get a good start to their own strategic planning process.

Key Takeaways

  • You probably don’t personally know all the components of your business’s success, but you need to find that information so you can pass it on.
  • Traditional planning tools, such as employee surveys and SWOT analyses, are important, but do not provide complete understanding.
  • Take the time to talk with all of your employees, no matter what their positions are, and ask for their perspective on the company. Then listen.

Creating a Shared Fate

As a business leader, I think it is helpful to create an all-for-one, one-for-all type mentality.  When I purchased my company, I used our first meeting together to talk about where the company had been and where it was going. But to make those plans a reality, I needed each and every member of the firm to be 100% invested in the future of the company. One of many factors that we used to align all of our values was to create the Shared Fate Program.

How Shared Fate Works

Each year’s earnings became the baseline for the next year’s profit-sharing program. We shared a portion of profits over that baseline with all employees. Each employee’s share was based on his or her position’s influence on the bottom line.

Every month, we calculated how much money would go into the program based on the average day’s outstanding on accounts receivable. We distributed the money monthly as well, the idea being that the team got paid when the company got paid. I wanted everybody in the firm to be exactly as pleased or as not-pleased as I was over the performance of the organization.

How Shared Fate Worked Out

The Shared Fate Program had a couple of outcomes:

  • When things were tough and we had to make difficult decisions, people were more supportive because they understood what we had to do and why we had to do it.
  • When we were bouncing back from the recession, people were more willing to work extended hours, including, sometimes, working over the weekend. They understood the importance of coming back slowly, instead of being in a rush to rehire a lot of people. Because we didn’t get trapped in overconfidence, and instead were willing to put in the extra work, the team as a whole benefitted.
  • The last outcome is a little more indirect. In a lot of companies, if people notice somebody is slacking off, they don’t do anything. They might say “hey, I can’t believe the leadership hasn’t noticed what Phil’s doing,” but they don’t see it as their problem. In our organization, the Shared Fate Program created a culture of accountability where if someone wasn’t doing their job, the others would say something to that person. People who didn’t want to pick up the pace would usually leave on their own because they didn’t feel like they fit in. The result was an organization where everyone was really working together towards common goals.

Key Takeaways

The Shared Fate Program created an all-for-one, one-for-all mentality that we all benefited from. By sharing information about money, as well as a portion of the money itself, we got a better-informed, more supportive, and more responsible workforce. When the leadership acted like we were all on the same team together, everyone else got into the act, too.

We’ve already talked a lot about nurturing our employees and developing strong working relationships with our team members. We’ve also talked a lot about good communication and how to transfer business savvy to the next team.

The common element in all this is interaction, but the challenge is how to make time to really get to know your colleagues. The key is to find opportunities throughout the work-day to involve future leaders so you can teach by example and foster the kind of communication that makes a business successful.

Lunch

We all have to eat lunch. I like to say never go to lunch alone. Always take a junior colleague or a peer with you to share the issues affecting you today, developing that common understanding of what’s going on in the organization.

Meetings

When you bring new, up-and-coming team members to senior level meetings, you’re introducing them industry leaders and making them a visible part of your brand. This is critically important, not only as a learning opportunity for junior colleagues, but also as a way to transfer the respect and credibility of your organization to the next leadership team.

Business trips

I’ve found shared business trips an excellent way to develop strong working relationships with new or promising team members.  Traveling together means spending a lot of time in airports and restaurants, as well as preparing for meetings. Those hours are not just an opportunity to get to know each other, but also a chance for you to demonstrate a solid work ethic and the other values and expectations of your company. You get to teach by example. You also get to observe how your protégé handles changing circumstances, such as flights being cancelled and things going wrong. You get to see how he or she performs under stress.

The Bottom line

By spending time with your colleagues, especially new candidates for future leadership positions, at lunch, in meetings, and while traveling, you can lay the foundation of strong working relationships that can last for many years.