by Triangle Performance Staff | Jul 28, 2009 | Kevin Berchelmann, Organizational Effectiveness
I frequently hear a discussion around this topic. Most wail and moan about employers today, about how “they” show no loyalty, about how “they” will lay anyone off at any time…
Personally, I believe too many answer this one-sidedly.
It’s not just employers who are not “loyal” anymore; employees seem to always be on the prowl for something new as well. Go to monster.com or careerbuilder.com, and do a search on your current company as employer.
Prepared to be a little surprised. Many — or most — have their resume out there, and are trolling for their next better opportunity. This is neither good nor bad, necessarily, but it does bear further investigation. (more…)
by Triangle Performance Staff | Jun 27, 2009 | Kevin Berchelmann, Organizational Effectiveness
OK, I’ll admit it. I didn’t graduate from an ivy league institution. Probably closer to coastal bermuda league, but that’s beside the point.
Harvard University has just announced severe cost reduction moves as its endowment loses another 30%.
Cue violins… no, wait, kill the fiddles, guys.
Lest we fall into alligator tears here, realize that this endowment is now worth a paltry $25B (yes, Billion) dollars. I used to work for a man, Jerome Robinson, who would say “well, isn’t that just a nice, round number??” He was talking about single-digit millions, of course, but the concept holds true. (more…)
by Triangle Performance Staff | Jun 26, 2009 | Kevin Berchelmann, Organizational Effectiveness
Catchy title, eh?? Saving Your Way To Prosperity…
The bummer fact, of course, is it can’t be done, so stop trying.
“We have to accept what we all know to be elemental — that taking a defensive position can, at best, only limit losses. And we need gains.“ (emphasis added)
— Peter Drucker, HBR 1961
Written in 1961 — almost FIFTY years ago — by one of the most brilliant management minds of our time.
Ok, we’ve had some economy missteps; I get it. Financial markets continue to be unstable, at best; I get it. Uncertainty seems to be the order of the day for many; I get that too…
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by Triangle Performance Staff | Jun 16, 2009 | Kevin Berchelmann, Organizational Effectiveness
I’m a Verizon customer. Have been since I got my first cell phone in 1992. They were GTE when I first signed on, I think.
Loyal? Hell no, just practical. They have the network that seems to support me best in my locale and travels. I’d dump ’em in a second if someone — ANYONE — came along with just a modicum of customer service or concern. I’m searching for the proverbial “iota” here…
I won’t give a litany of examples of my thoughts and opinions on Verizon’s poor customer service; after all, this is a blog, not a whine. I’ll just use the most recent…
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by Triangle Performance Staff | May 11, 2009 | Kevin Berchelmann, Organizational Effectiveness
“That generation just doesn’t have a work ethic.”
“They always want things handed to them…”
Blah, blah, blah… we’ve all heard it, right?
All in all, I think the whole “work ethic” debate is a bunch of bunk.
In my experience, people really define “work ethic” as “works as hard as I do.” So, if someone has a “good” work ethic, then they meet my standard of effort; if they don’t, they don’t. This is easily exemplified when people will disagree over a particular coworker’s “work ethic.” (more…)
by D. Kevin Berchelmann | Apr 20, 2009 | Brazen Leader, Human Resources, Kevin Berchelmann, Organizational Effectiveness
I’ve worked with many organizations, both as the in-house compensation expert as well as an outside consultant, and determining the economic return for incentive plans is clearly a significant effort – and there’s sometimes nothing simple about it.
Incentive plans do not work in a vacuum; even with potentially great compensation plans, outside forces can be such that the results are almost anecdotal. This doesn’t mean we shouldn’t make every effort to measure the results, but it does mean that any specific measurements will have “assumptions” built in to the equation.
Some client examples:
I implemented an extensive gainsharing plan for a $100M division of a $1B manufacturer/smelter of zinc ingot. In less than 18 months, we reduced the average production cost per pound by well over 35%, and split the dollar savings evenly with employees, some of them nearly doubling their typical hourly wage. Now, was it simply the incentive plan? Well, as part of that effort, we conducted extensive training, constant follow-up, intense metric evaluation and trending… in short, we implemented a process “around” that incentive effort.
So, did the gainsharing “cause” the improved performance?
It certainly played a significant part.
With a small, fast-growing bio-tech firm, we implemented significant incentives for management’s leadership in driving research & development and time-to-market. The incentives paid out fairly handsomely, and time-to-market for new products was reduced by almost 15% in less than 12 months.
Was that caused entirely by incentives?
Hard to say; time-to-market had become an incredible focus before implementing the incentives, and was reflected in many management efforts, hiring, etc. Clearly, the incentives played a part, but how much?
Finally, with a $120M industrial services firm, we implemented sales incentives that had the most generous “upside” in the industry. 12 months later, we realized an increase in revenue of almost 15%, with margins equal to or better than before. Yet the company still entered into Chapter 11 bankruptcy, and the strategic buyers immediately discontinued the plan, saying it was too “rich.”
Did it play a part in the company’s slide into Chapter 11, or did it stave off that bankruptcy for several more months? Again, it’s difficult to determine, given the pressures on the entire organization at the time to reduce costs, increase revenues, and bolster margins. It certainly made more in earnings than it cost in incentives, by a factor of almost 13x.
Again, these plans don’t work in a vacuum, and are usually part of an organization’s current strategic focus. As such, measuring ROI aimed squarely and solely at a particular incentive plan will always be difficult.
Can we measure the total impact of the effort, INCLUDING incentive plans? Of course, and that’s likely the most successful way to run a railroad anyway.
