Many companies in the United States measure their success by benchmarks known as key performance indicators (KPIs) – most commonly revenue growth, profit margin, and labor productivity. Best practices state that KPIs must be clear, meaningful, cost-effective, realistic, aligned with objectives, and measured regularly. Investor-owned and large companies in the service industry are likely to be data-driven, but what happens to these companies and their cultures when they are primarily accountable to reports, metrics, and numbers? While these companies often give lip service to concepts like employee and customer satisfaction, the true focus is KPIs. Although short-term profit may be achievable, long-term success becomes difficult due to employee dissatisfaction. Employees realize they are just a number – a cog in the wheel – resulting in high turnover and low morale.
Banking on Your Employees
|“From what I can see in the industry, our employee ownership model is unique, and our lack of principal-based ownership, which is so typical of engineering and architectural firms, encourages an investment by us, the employee owners.” – Mike Bryan, President and CEO|
Despite the KPI prevalence, the key to sustained success may be much more nuanced than any number or metric can quantify. A company that promotes a servant-leader mentality and focuses on strong personal relationships, client success, and employee satisfaction is much better positioned for long-term success. Interestingly, when employees and clients are the focus, the numbers take care of themselves. Instead of leadership trying to control and measure all aspects of a project, employees are empowered to make autonomous decisions daily without fear of reprisal. An employee-owned company is best positioned to take advantage of this culture – a relationship-focused approach between leadership and employees.
The data-driven approach often overlooks the intangibles, tramples on common sense, and inadvertently adopts a myopic view of success. Key performance indicators are not evil, and there are times when such metrics help identify problems or highlight successes. However, if we take the humanity out of employee evaluations, we do a disservice to the company and risk losing good people. Leadership should get to know their employees; when employees feel connected with their company, they are more willing to go the extra mile.
Putting Your People First
There are many components to creating a successful people-focused culture. First, leadership must embrace and commit to this approach. Next, they must hire and build a like-minded team of employees who sees the big picture, is interested in more than just a paycheck, and wants to serve a company that serves them back. Finally, establish a clear written vision for employees and clients that clearly describes the goal: “To be our clients’ first choice by empowering each employee to provide reliable solutions drawing on decades of technical expertise.”
Another critical step is communicating who you are to new employees by setting expectations from hiring through the onboarding and new employee development process. A tangible demonstration of company values can include statements such as:
- Be respectful
- Show empathy
- Reserve judgment
- Include others
- Demonstrate gratitude and appreciation
- Respect boundaries and differences
Sustaining this type of client- and employee-centered culture takes ongoing effort. Communication and reinforcement can be more challenging if a company is spread over multiple locations. Look for ways to stay connected with remote employees, such as:
- Provide monthly updates that connect employees to the company and the culture
- Divide employees into groups with a team leader who checks in weekly
- Offer upward mobility to high-performing employees based on their value rather than their credentials
- Start a Mentor/Mentee program with scheduled follow-up
- Offer ongoing training opportunities
- Solicit employee and client feedback through surveys
Creating a Winning Culture
Leadership can reinforce this people-centered culture by asking what they can do to help, looking for ways to remove obstacles, and asking for employee suggestions. In addition, they can encourage employees by empowering them to make decisions, take risks, and think creatively. Does this mean no one will ever make a mistake? Of course not, but when employees know their company will have their backs and a mistake will become a teachable moment, not a firing offense, they can make decisions without fear of repercussions.
The benefits of the servant leader culture are profound as it creates a continuous positive feedback loop of motivated employees helping each other and selflessly serving clients who become repeat customers. When the company does well, employees are rewarded through salaries, bonuses, and profit sharing. Furthermore, with an employee-owned company, they also have the option to purchase company stock and benefit from profit sharing and stock dividends. Financial rewards and a supportive leadership team contribute to long-term, satisfied employees who look forward to serving satisfied, repeat clients – without the burden of focusing on KPIs.