The Best Places to Work

The Best Places to Work

By: David Van Rossum

We have all seen lists of the best companies to work for. These lists are sorted in various ways as is the practice in publishing business lists. They are sorted by region, size and industry. They are voted on in polls or identified by media based on research.  Organizations use high rankings in these lists to recruit and tout their employee focused corporate culture. I recently saw a job posting that described how the CEO had pizza parties every Friday. I like pizza but it’s not on my top ten list of employment concerns. The way we dress in a business setting has changed drastically over the last couple of decades. The prevalent theory is that a comfortable work environment spawns creativity and increased production and I don’t doubt it. Job titles have morphed as well. I have seen postings for Chief People Officers and Head Cat Wranglers. Organizations have become flatter or, in some cases, claim to be. Flex time, telecommuting, virtual offices and the ability to earn sabbatical time from a business are in vogue. Many young people expect their work environment to include these less rigid settings since they have not experienced different environments. Companies can attract top performers from competitors and the general labor market if they are perceived to be one of the best places to work.  The military-like labor hierarchy of our old manufacturing based economy has changed as our business landscape has evolved toward service and software generated products. A happy employee is a good employee. It makes sense. I want my fellow workers to proudly wear company apparel. It’s all good.

                Companies need to provide employees with a safe work place. They should pay a competitive wage. They should be fair in disciplining, promoting and financially incenting their workforce. They should have clearly communicated goals at all levels. They should have internal communication structures that allow information to flow appropriately.  They should try to be a good corporate citizen in their community. They need to implement strategies to attain shareholder wishes. The employee owes the company sustained hard and effective work. What makes a company a great place to work, in my opinion, are those listed above in this paragraph together with another important element, a sustained success in the market place with promise for future growth. Employees should work hard to achieve that sustained success. That success provides job security (always important, but especially in today’s marketplace) and hopefully individual career growth and increased compensation. I do not mean to exclude start-up companies from my description. Obviously they would have trouble meeting my sustained success threshold. They can, however, have a solid plan for future success and executives and other key employees who have “done it before” or the backing of PE firms or others who have expertly gauged their chances.  A successful company that provides a fair and safe work environment, market based compensation, and community involvement is the kind of place where I want to work. The perquisites listed in the first paragraph are welcome by me, but they are secondary to the basics of business. If the focus is slanted too much toward employee comfort and the development of a “cool" corporate culture, hard times may be difficult to navigate.

                I admire successful companies that have adapted their culture to be employee-centric without losing customer focus. I can remember the evolution of dress codes from business suits, to casual Fridays to only wearing a suit when deemed appropriate. What you wear doesn’t correlate to success. The New York Yankees had strict grooming and travel attire rules under Joe Torre. They were successful. The Tampa Bay Rays under Joe Maddon enjoy a completely different culture. They are successful. The company culture doesn’t always insure success or failure. Everyone having a voice is ideal. Everyone having a vote can be slow (see Congress). Someone has to be the boss. A young company would do well to concentrate on developing a sound business foundation based on solid products, cash flow and growth. It’s great if they can do this from the beach. If they can’t then they should not be at the beach, but in the office.

The goal of being the best company to work for is admirable if it is combined with the primary goal of attaining shareholder expectations. A company should never abandon safe, fair, and consistent work rules to achieve those expectations, but they shouldn’t promote relaxed work environments over the value of good, hard work ethics and focusing on overall company results. I worry sometimes that our fresh, newly educated college grads expect a casual environment where their happiness is the number one priority of their employer. Companies do not owe employees free pizza and flex time. They are luxuries. If you are lucky enough to work for a company that provides these luxuries, count your blessings. If you don’t, but you are doing well financially and have a stable future, you are still lucky. If I had my druthers, I would like to work hard in a “cool” company culture for a successful firm. Have my beautifully frosted cake and eat it too. Most importantly, I want to eat and know I can next year too if I do my job well. The rest is gravy.

Company Waste: Some Companies Too Slow to React to Downturns

Company Waste: Some Companies Too Slow to React to Downturns

By: David Van Rossum

Take care of the small things and the big things will take care of themselves. Ever hear that? A nice adage designed to remind us to keep an eye on detail.  A company in the midst of a downturn would do well to reverse that thinking.

                Many of us have worked for firms that have been forced to cut costs because of declining sales or sharply rising costs. Meetings are held to figure out how to eliminate waste. Forecasting the length of decline is always a problem. Ideas that percolate during these meetings are numerous. Adjust the thermostats to lower heating or cooling costs. Use less paper. Use the backside of documents for notes. Turn off lights. Maybe reduce the lighting by removing half of the bulbs. Get rid of the coffee service. Have the cleaners come in less often. Eliminate certain expenses such as paying for lunch locally when there are no outside participants. Reduce magazine and newspaper subscriptions. Cancel a holiday party. Adjust the intervals for landscaping services. All of the above could have been done long ago, but weren’t because things were good. The list grows and after the meetings we are satisfied that these changes will both save money and instill a sense of urgency in our workforce as we all share in the pain. It also signals that more drastic measures may follow, unsettling many and perhaps incenting others to pitch in with more ideas or greater productivity.

                Time passes and the decline continues. Reality hits. The company needs bigger savings. More ideas are put forth. These are the tough ones. Headcount reduction, changes in healthcare benefits, shutting down locations, terminating production commitments, pay cuts or schedule reductions, forced shutdowns. Numbers are run. Reality sets in. Time passes. The firm waits another month just in case business picks up due to price changes or specials that are implemented.  When they don’t work, they decide that they have to pull the trigger on these draconian measures. Lists are formulated as to who goes and who stays. This gets hashed out over time. Then the decision is made. The company will implement these measures in two weeks. This gives them time to craft separation agreements and consult with labor attorneys. It gives them time to negotiate with suppliers. Secrecy is paramount, but everyone knows. The need for resources is debated and adjustments may be made. The plan finally goes into action. The survivors take a big breath and acknowledge the hardship of maintaining the operation with reduced resources. Executives congratulate each other for making the tough decisions. Valuable employees cast an eye toward other opportunities as people tell each other that they are “lucky to even have a job.” The message is sent out from the CEO that the regrettable actions are necessary but if everyone pulls their oars the company will rebound and grow to be bigger and better in the future. The C levels drive their company cars home and worry. The cuts are two months too late.  Sound familiar?

                When a company is forced to significantly reduce costs, they are almost always too slow to respond. Should they implement small savings programs such as those described in the first paragraph? Of course. Should they be implemented before attacking the larger issues? No. When the demand for goods or services decline, or the market isn’t able to absorb price increases for products that have been rocked with higher costs, it is generally due to one of two basic issues. The products or services are not a necessity, or the competition has built a better mousetrap. If your output isn’t a necessity to your customers, you better have a plan to implement before the decline starts. Staying ahead or current with competition should be built into your corporate culture. That is a subject for another day. When profits erode, place an emphasis on taking care of the big things first.

                 

                When profit declines or decline is predictably imminent for a company, management should look to protect the investment of the shareholders as aggressively as possible. Financial service companies have detailed disaster recovery plans. Most companies have succession plans. All organizations should have a plan to deal swiftly with a downturn. For example, supply chain management should have a ready list of the costs of slowing down or cancelling vendor commitments.  All managers should have a reduction plan including headcount, facilities or other resources and their consequences. Executives should have an idea of possible partnering arrangements with friends and competitors alike. These arrangements could include sharing shipping containers, rebranding excess inventories, sharing back office support, and possible business combinations including merger or acquisition. The finance department should be well versed on debt covenants. These are all big ticket items that need already be identified when the decline begins. Your company probably has some unique costs. Most companies don’t have these possible actions outlined and updated. Some do, but probably because they had to go through a cost reduction recently and they are now faced with further cuts. It would be dangerous to act on many of these ideas prematurely.  It could be devastating to suddenly be unable to meet demand if the downturn was merely a blip. If, however, you are in a meeting that discusses getting rid of a coffee service or reducing office cleaning intervals, trust me, you better have large cost saving plans available and ready to be enacted.

                If your company is beginning to struggle or is in the midst of a downturn, chances are so are its customers. Those customers will be looking to roll back deliveries or slow down payment for your products. They will probably look to negotiate changes in their buying commitments. Your company better be attempting to do the same with their suppliers. Reducing headcount is a very hard thing to come to terms with. Keep in mind that it is much easier to recall laid-off workers if business picks up then recover the capital spent for an unnecessarily large workforce.

                My message is simple: Be prepared to reduce your large costs when a down turn forces you to turn down the thermometer!

An American Somebody

An American Somebody

By: David Van Rossum

    This fall is different somehow. When you ask a New Englander what their favorite time of year is, you shouldn’t be surprised that autumn is an oft received answer. The weather is generally suited for outdoor activities and the home provides a comfort at night. The foliage is spectacular and the combination of football, hockey, basketball, field hockey, and golf is hard to beat for an active sports fan or a doting grandparent watching youth programs. Halloween announces the coming of the Thanksgiving season with the joy of beaming small faces dressed to scare or impress at your door, lighting up the darkness that begins to encroach on our days. Thanksgiving gatherings, though sometimes filled with family strife, end with the beginning of the colorful season of Christmas where the newly bared landscape comes alive with bright reds, greens, silver and bright whites that the holiday brings through natural and artificial sources. Tourists are confined to weekends and the snowbirds haven’t begun their migration to their homes in Ft. Meyers or Daytona or Phoenix. The community is alive with those that call here home. But this fall is different.

     The news of this fall isn’t good. The economy isn’t providing job growth. Worldwide unrest and revolution seems so much closer now than it did when I was a kid. The political campaigns are filled with finger pointing and outlandish criticism from those brave enough to enter the fray and those who get paid to tell us what we should be able to discern for ourselves. The tragedy of the goings on at Penn State rock our faith not only in what was once a Rockwell portrait of a college town bound together by the love of the school, the Nittany Lions and Joe Paterno, but  also in the makeup of our day to day population. The dreamer and the cynic are both dead. Apple will survive, but network TV as we know it may be dying as well. Wall Street is occupied because some have and many don’t, but are the demise of capitalism and the redistribution of wealth going to make things better? I want my children and their children to keep the incentive to succeed in a free market that we have enjoyed for generations. We are closer to each other thanks to social media, but in many ways we are further apart. We don’t need to see each other. That is a shame.

     I have walked the beach here on the coast of New Hampshire more times than I can count. Generally I walk down the road to the beach access, then south toward Jenness Beach, stopping for coffee at Rye General or the Sandpiper during the months they are open. Sometimes my wife and I walk together, sometimes we have a dog or two with us, and sometimes I walk alone. It is rare that I don’t run into a friend or acquaintance along the way or at the store. The number of people along the way change with the seasons but the surfers are always there, seemingly in increasing populations. The fall is a wonderful time for these walks. This is when almost everyone you encounter is home. This fall has not changed in that regard but still it is different.

     A lack of a lucky streak is unsettling to me. I am out of work and have been for a long time. Trying hard to put on a brave face and search the internet and personal connections for a position where I know I can contribute and can sustain my family is a daily ritual. The years of good living that we have enjoyed due to past hard work has deteriorated into the uncertainty of how to heat the too big house that has been for sale for three years, now priced at 75% of the tax assessed value. I worry about food prices. It is wearing on me that the head start I was able to give my children versus what I was able to get from my hard-working parents has come to an end. Though this is a different perspective for me, it is not what sets this particular season apart for me.   
                                   
     Lately my walks have changed. I see the tracks of bare feet and shoes and wonder who they belong to. I appreciate the fact that I live in a beautiful place. I have the same number of dreams but their duration is shorter. I don’t know if that is because of age, circumstance or the strangeness that has abounded the past couple of months. Not Stephen King scary strange, but eerie nonetheless.

     A few weeks ago I walked down the beach among groups of small shore birds. I am no expert on wildlife. They were birds I have seen many times scuttling toward the shallow waves and retreating at a quicker pace. Sandpipers maybe. I know we have plover in the area. This particular morning their behavior was changed. As I walked, a group of these busy birds skittered around me. This circle moved with me for many yards, then fell back. Shortly I met another group and they too circled my path for another distance. Never before and not since have I experienced this peculiar procession. I imagined, perhaps foolishly, that they were forming some sort of protection against the unknown or they were looking for the same from me. Days later my wife and I were walking the sands and came across many dead seagulls and the washed-up carcasses of baby seals. This phenomenon persisted for days up and down the New England coast. Scientists investigated, but no answers have been found as of this writing. The Halloween that we look forward to never really happened. A storm blitzed the region with a wet snow that knocked power out for days and caused many communities to postpone trick-or-treat night to early November. I’m not even sure when it was held in my town. Then warm weather arrived, livening-up the coast in a way that seemed unnatural. The moon shone bright as the days shortened. Our dogs were reluctant to stay outside for long. Fall was different somehow.

     Yesterday morning I walked home along the beach with a mild wind at my back. Coffee in hand I strolled with no purpose as I gazed at the few surfers that were out in relatively calm waters. People were walking their dogs as usual, but not as many as I would have expected on this sunny day. I saw no one I knew. I noticed large shells along the way and tried to recall if this was normal. My mind was full of worry as I contemplated the job search that I would continue upon my arrival to my study. I paused per usual at the water end of the short beach access road that would take me to Old Beach Road. I was studying the motion of the small waves when I noticed some activity to my right. A woman had come out of her very nice house that abutted the sand. She began to lower our flag from the pole that rose from her patio. Recalling some deep seated protocol I turned toward the descending flag, removed my ball cap and stood as much at attention as I know how. While I was performing this show of respect for the emblem of our great country, I realized that my actions were meant to be noticed by this stranger of a lady who had no idea I was even there. I was doing it for the acknowledgement of doing the right thing not for truly heartfelt pure patriotism. Maybe I needed that reinforcement, but I was ashamed of myself. I paused a moment more then started up the access road, thinking about what the flag represents to me. I can’t say my heart grew ten times bigger like the Grinch, but I know that my reflections brought me back to what was fundamentally important.  Of all the events and sights that were seemingly foreign to me this season, the ideals that should never wane in importance were the same as when I was first aware of them.  Life, Family, Community and Country. I am blessed to be a part of all of them, and it is my duty to protect and try to make better those basic elements that make up my being. I hope I can.

     Thanksgiving looms in just a few days. I now know what to be thankful for. This fall feels different somehow.

Company Waste: The Mission Statement

Company Waste: The Mission Statement

By: David Van Rossum

                 Walk in to any company today and you will be sure to see a mission statement posted prominently for all to see.  These statements are used as a tool to help bind employees toward specific ideals and to show customers and the market place that the company has a guiding theme. These statements are revisited from year to year by in-house focus groups sometimes aided by consultants. Many times they are joined by sister statements of various names that focus more toward the execution of the mission statement. These sessions are often valuable as forums to exchange ideas and provoke lively discussion, a worthy use of time. Their intended products, however, are not as useful as those discussions.  The mission statement often talks about being innovative, or providing the best product or service. They may extol the company’s aim to be community oriented and to provide a healthy workplace. Some  may speak to the environment. They are all short and to the point. Few employees think of these statements as they go about their daily business.

                These statement are a little like going to church once a week, though as stated previously they are visited less frequently. Organizations are seeming to  fulfill a responsibility to tell themselves and the world what they are striving to be. Different thoughts emerge in different sessions separated by time and changes in the company or marketplace.  They change the same way quality programs do. They have different names. Quality programs are meant to ensure and improve quality. Some programs teach you how to measure quality consistently and uniformly. They teach you how to measure processes even if it means merely depicting what you did wrong again and again. They do not remediate, they report. Consultants and specialized companies make their money by designing and showing how to implement their programs so the company can proudly proclaim that they have become certified on how to measure the quality of their operation.  The real challenge, I have found, is not figuring out how well you do something, but concentrating on how to improve on what it is you do. Mission statements do none of the above.

                Too often management gets embroiled in discussing mission and purpose without injecting the reality of why they exist at all. A business is incorporated to make money. The money they make is to either be distributed to shareholders or put back into the business to generate further return. For a nonprofit this return may be in the form of providing more services or reaching a larger population.  For profit companies may reinvest in order to increase future income, adding to the worth of the company for its owners. It’s that simple. Those ideas should be the focus of a mission statement.

                The words in contemporary mission statements, if adhered to absolutely, can enhance or impinge on the concepts of growth or increasing profits. Many  companies have statements that talk about being environmentally sensitive. They may change packaging or choose “green” energy to power their operations. These practices invariably increase costs. This rise in cost will result in lower margins if the company is in a price sensitive environment. If not, they may be able to increase their prices to their customers and not take a hit for their social awareness. Mission statements that call for “the best” product or service do not take into account that providing such may require significant additional resources that would cost them right out of the market. Companies that tout community service and are true to their pledge, lose productivity when employees are not available due to “service days” that are paid for by the community and do not add to the productivity of the company.

                Don’t get me wrong. I’m all for community involvement, striving to be the best, and being sensitive to the environment. They are qualities that I admire greatly in companies that actually implement programs that make them “good corporate citizens.” Those elements of a company’s makeup are, to me, part of a definition of what the company is as it moves toward its real mission of increasing shareholder value. Community involvement and green energy can be an effective part of an advertising program. Firms that donate money or employee time are, more often than not, rewarded with signage and local media coverage that makes the commitment a cost effective tool in reaching customers. Altruism is not, it would seem, free in these circumstances as ink space and banners are dedicated to trumpet the donor and not the cause. That’s okay. Again, I see this as a tool toward the real mission of a company. I don’t think that organizations in decline will make the same commitment to being green and participating philanthropically that they would when profits were growing. That doesn’t make sense if it’s in their mission statement, does it? Shareholder value trumps charity, and it should. It is why the company exists in the first place.

                So I ask, why spend money and time over and over again in order to define the company’s mission when it can be summed up in ten seconds? Some of that money can drop to the bottom line and maybe some can go to a solar panel. Replace those framed words with framed results and defined business goals. Safety programs do this well. They advocate a goal such as number of lost days in a period and then report on the progress. The idea is to promote and provide safety. Simple. We should stop spending money and energy on poetic statements and instead channel that energy and time into increasing the value of our products, services and corporate value. If management needs to gather and figure out what the mission of their company is, then something is probably broken. Why do they do it? They have been told by experts that they should. It is wonderful to want to provide “an employee friendly” workplace. Why do it? They want to attract and retain the best talent. Why? To increase shareholder value. Would those talented employees work for free? No. Let’s not kid ourselves that the comfort of our employees beyond what is legally required is our mission. It is our means to be successful.  (Did I mention that employees rarely pay attention to the mission statements posted prominently in their workplace?)