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Contented cows give better milk: Your people … your profit

Richard Hadden Published on 16 March 2011
“Take away my factories and I’ll build a new and better factory. But take away my people, and grass will grow on the factory floor.”—Andrew Carnegie

Andrew Carnegie was no bleeding heart, social humanitarian do-gooder, but rather a Capitalist with a capital ‘C’ – a man whose fortune, in today’s dollars, would stir envy in the heart of Bill Gates.

Yet the immigrant industrialist was simply acknowledging that in his steel business – just as in your dairy business – people mean profit. Your organization’s ability to attract, retain and make productive the best talent available has a direct impact on your ability to grow, make money and sustain a competitive advantage.

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As dairy producers, you don’t need me to tell you, as Carnation Milk has always asserted, that “contented cows give better milk.” And while there’s a big difference between people and cows, the same principle applies in the workplace: Satisfied employees give better performances.

They’re more apt to show up on time, put more into their work, go the extra mile, take care of your assets and do a better job for your customers. And all of this results in a more profitable business.

In fact, our firm’s research over the last 15 years shows that pursuing a strategy – and it is a strategy – of creating a great workplace is one of the best things you can do for your bottom line.

OK, so a great workplace strategy might make you attractive to potential employees, but other than that, who cares? Your banker cares. So do your suppliers, your vendors and others in your community.

Each employee, and even each candidate who applies to work for your company, is a window into your organization. Your reputation as an employer – not just a producer – speaks volumes about the health, well-being and character of your business.

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Why is this important now? Because no organization can hope to succeed, especially in the wake of a troubled and still-sluggish economy, without the full commitment and engagement of a focused, fired-up and capably led workforce.

Being an employer of choice is not as easy as upping compensation or plugging in the latest, most elaborate and costly employee perks. Instead, today’s best and most profitable employers focus on sound organizational and leadership practices that get the most – willingly and enthusiastically – from everyone on the payroll.

Here are six things you can begin doing right now that will have an immediate and long-lasting impact on your company’s ability to succeed through its people practices.

1. Hire for fit. Skills, expertise and experience aren’t enough. Identify what it takes for people to be happy, productive and successful in your organization. Articulate those “fit” requirements to all hiring managers and provide incentives for hiring around those factors.

Use behavioral interviewing techniques to identify candidates whose values and attitudes set them up for success in your organization.

2. Define your mission in clear and compelling terms. Having a clear sense of mission is motivating. I’m not talking about a mission statement, but rather a sense of mission. Make sure everyone – from your CEO to your newest hire – knows why your business exists and can articulate its most important priorities.

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Here’s something you can do right now to see how you’re doing in this department. Ask yourself, “What are our organization’s top three business priorities?”

Write your answers on a piece of paper, put it in your pocket and go out and ask the first five or six employees you happen to see the same question. Compare their answers with yours and with each other’s. Should the answers stray too far from one another, you’ll know it’s time to get busy focusing everyone on what matters most.

3. Get rid of systemic barriers. Everyone’s got them: policies, procedures and rules that get in the way of your employees doing their very best work. As the late management guru Peter Drucker observed, “90 percent of what we call ‘management’ consists of making it difficult for people to get things done”.

Here’s a challenge: Today, eliminate or fundamentally change one utterly stupid practice, policy or procedure that hampers the flawless execution of your mission. (If you can’t think of anything, just ask your employees.)

4. Make sure everyone understands the importance of their work. The minute someone loses sight of this, he can’t possibly perform at the top of his game. And yet, if you’re like most businesses, you have some good people who, in the regular course of performing their jobs, never encounter a real, live, paying customer.

Change that! Create opportunities for everyone on your payroll to have a “customer connection.” Organize a field trip to a customer’s site; let your office employees spend time with your salespeople and vice-versa; lace employee communications with frequent reminders of how their work touches your customers.

5. Show your employees you care about them. I don’t mean coddling or pampering, but doing simple things, every day that let others know you care. Ask how their families are doing. Pay attention to (but don’t pry into) what’s happening in their lives.

Congratulate them when something good happens. Take time to listen when they’re having a problem. Do what you can to help them do their jobs better, more easily and safely. We know employees simply reserve their very best work for a leader who cares about them.

6. Give clear, helpful feedback. One of the most uncaring things I see business owners and managers do is fail to tell someone their performance isn’t up to standard. Give bone-honest feedback, with sensitivity, and give people the chance they deserve to improve.

If you take these measures, and others, to create the kind of workplace that attracts and retains the best talent, don’t keep your success to yourself. If you’re proud of your employees’ loyalty and longevity, mention that to your banker and in conversations with other suppliers. Excessive employee turnover costs money. Healthy retention means a better bottom line.

Tout your employees on your company website. One company we work with highlights what they call “Extra Milers,” and each month features a deserving employee in a special section on their website, in social media and in all customer communications.

One of the best ways to showcase a happy, committed workforce is to give back to the community. When others see an organized show of support, through a Habitat for Humanity project, work in a homeless shelter or serving meals to at-risk families, they’ll know you’ve got a group of people who are committed not only to your business, but to the community beyond.

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The results of having a focused, fired-up and capably led workforce can’t help but show up on your P&L and balance sheet.

Leaders who hire well, articulate a clear mission, enable people to do their best work and care about their employees will help their companies outperform the competition, even keep their cows milking and their parlor in operation. PD

Richard Hadden is co-author of the Contented Cows leadership books, and the new book Rebooting Leadership. His company, Contented Cow Partners, conducts leadership training and employee surveys, and Richard delivers keynote presentations on the connection between people and profits. Learn more on the web at ContentedCows.com

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Richard Hadden
Contented Cow Partners LLC

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