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Organization and Staffing – Ground Rule #4 – Dealing with Advancing Age

This is the eleventh in a series of posts that will describe what the CEO of the Reliance Electric Company thought about basic commitments, how the organization was going to operate and ground rules for managers. Once again, all the content of this article is based on the work of B. Charles Ames as outlined in his management manifesto titled Basic Management Concepts dated January 14, 1974.

Organization and Staffing – Ground Rule #4 – Dealing with Advancing Age 

I am going to deviate a bit from my normal practice of simply repackaging the words Chuck Ames used in Basic Management Concepts for Ground Rule #4.  Ground Rule #4 deals with advancing age in the workforce.  Some of the content needs to be brought up to current EEOC standards.  Plus, there is some new research that suggests our opinions about the capabilities of older people in the workforce may not be quite accurate.  See “Why Everything You Know About Aging Is Probably Wrong” from the December 1, 2014 Wall Street Journal.

Ames wrote that some individuals, as they age, may reach a point where their job responsibilities exceed their energy levels and capabilities.  At some level this is certainly true and will indeed happen to us all.  Ames felt that the organization had an obligation to people who served it loyally.  He stated they should be paid fairly and given assignments where they could be successful.

He went on to say that older workers unable to make a continuing contribution needed to be removed from the mainstream.  He figured it wasn’t fair to the individual or the corporation to leave people in roles where they were likely to be unsuccessful.  An appropriate ground rule, regardless of age, I would add.

In conclusion he wrote that advancing age alone should not be a reason to exclude anyone from consideration for an assignment.  He stated there is nothing more wasteful than bypassing an experienced individual because of age even though that individual has the drive and energy to be successful.

Certainly an excellent ground rule whether it is 1974 or 2015.

B. Chuck Ames and his wife Jay currently manage the Ames Family Foundation.  They divide their time between a home in Vero Beach, Florida and a second home in a suburb of Cleveland. 

 

 

 

How To Trim and Score Your Customer List

I heard a great quote recently; “If a salesperson is calling on more than 50 prospects and customers, that salesperson has a hunting license instead of an account list.”

It is unrealistic to think you can manage more than 50 accounts.  The only exception to this rule is if you are selling high end capital equipment that is purchased once every 20 to 30 years.  But, if you are making repetitive sales to the same customers over and over, you are kidding yourself to think you can manage more than 40 to 50 accounts.

After you slim down your customer list do some analysis and I’d wager that somewhere around 80 percent of your revenue comes from the top 20 percent of your account list.  Furthermore, those last few accounts that make up your top 20 percent of the revenue are substantially smaller than those at the top of your list.  Do some account review and balance your accounts with some new larger accounts.

Next, implement an RPM Customer Scorecard.  Yes, just like purchasing does with your suppliers, but they call it a Vendor Scorecard.  An RPM Customer Scorecard measures three critical components of a customer:

  1. Revenue.  What is the gross sales volume of each customer?  Those accounts at the top receive a value of 10 and those at the bottom get a score of 1.
  2. Profit.  This is a measurement of the percentage of revenue that goes to the bottom line.  The highest get a 10 and lowest get a 1.  Here’s a chance to work with your controller!  Controllers are pleasantly surprised when salespeople ask this question.
  3. Maintenance.  Here’s the fun measurement, sometimes called the nuisance factor.  Those dream customers that you enjoy working with, although demanding, are fair and when they need a favor you go out of your way to help them.  On the other end is the person’s name that makes you flinch every time you see it in your inbox.  They ask for discounts, shorter lead times and never say thank you.  You can guess who gets the 10 and who gets the 1.

Total up the scores.  A score of 25-30 represents a customer you want to make sure you have a plan to keep them as a customer.  A score of under 10 is a customer you should refer to a competitor.   With this scorecard in hand think about the creative conversations you can have with your customers, particularly at the time of a price increase.  With those customers scoring between 10 and 25 you can have great conversation reviewing the scorecard.

 

 

3 Ways to Help Your Organization Accept Change

All too often, communication missteps and a failure to motivate employees to adapt are causing corporate change initiatives to fall short and hurt the bottom line. What’s more, they also harm employee engagement.

With the rapid pace of change required to succeed in today’s ultra-competitive, global business environment, the organizations that thrive are the ones that can successfully trigger swift, strategic, and operational transformations that employees understand and embrace. Change is constant and necessary if the organization is going to compete, grow, and prosper.

Many organizations, however, are failing at this critical business element, not because the objectives and tactics haven’t been thought out, but because of how they are delivered to those who are affected by the change. Also, change management initiatives typically fail because the business managers responsible for enacting the change are not providing the affected employees enough personal motivation.

Three Activities to Foster Change

Corporate leaders have an opportunity to change this trend and leverage their workforce recognition solutions to help shorten the acceptance curve. A change initiative’s success or failure is defined by how quickly the change becomes part of the organization’s accepted methodology and is adopted by employees.

So, the key to ensuring change initiative success is quickly motivating affected employees to accept and utilize the new methods. Leaders can leverage their employee recognition and reward systems to help enact these changes through three primary activities:

  1. Communicating the change to inspire buy-in.

  2. Connecting individual and management goals.

  3. Adding actionable measurement.

Communicating the Personal Context of Change

While the volume of communications deployed during change initiatives is high, the focus is typically on explaining the enterprise rational for making the change — be it improved operational efficiency or increasing financial returns. Often, the communication plan does not put the change into personal context or give employees a reason to care.

Individual or team-based goals and objectives that illustrate success from the employee’s point of view helps employees make the personal connection and can be accomplished with customized communication plans. This is an opportunity for the leader to develop targeted plans that tailor the personal change objectives to the select role, length of service or location, etc. When it comes to communication related to change, one size does not fit all.

Clearly Connecting Individual and Manager Goals

Even though executives often have a high-profile role in describing the business changes, most are not addressing employee concerns. How will this affect me? How will my participation be measured? What’s in it for me? Answering these questions and translating corporate objectives into desired employee actions are critical.

Using the employee recognition solution, managers can set goals and reward outcomes connected to the change and even use their reward budgets to promote quicker uptake and to acknowledge early adopters. Socializing the change at the grassroots level helps organizations limit early resistance and reinforce the positive opportunities the change represents.

Adding Actionable Measurement Goals

All change initiatives have important high-level measures to gauge success; however, tracking aggregate financial gains, operational efficiencies, and customer satisfaction improvements are lagging indicators. They do little to chart the path toward sustained change and provide no diagnostic insight on how to expedite acceptance and counter resistance.

By incorporating the workforce recognition solution to help in the change management communications and motivations. Try to pinpoint where and when change is embraced or rejected at an individual level. This detailed analysis targets potential problem areas with new communications campaigns or goals/rewards programs and further limit implementation resistance.

A company’s ability to change — and to do so efficiently — can be a significant source of competitive advantage. Management has an opportunity to help organizations speed the time of employee acceptance and use the company’s recognition program to help employees adjust and adapt.

Leaders who are effective at implementing change create communications that inform and inspire, introduce recognition tools that help establish and maintain a clear connection between the organization’s goals and an individual’s actions, and better identify employees who need additional training or motivation to transition completely. Yes, organizations do, indeed, have a lot riding on their ability to change the way they do things. However, with the help of employee recognition platforms and focused communications tailored to the individual employee, change can be a very powerful corporate strategy.