Business Articles

Automotive Digest: Where the Auto Industry Should be Going - 3 Part Series
Part 1: Lessons Learned from "Cash for Clunkers"
Part 2: What the Automotive Leadership Needs to be Doing
Part 3: Market Predictions for the Big Three Automakers

Other Articles
Supply & Demand Chain Executive: Managing Your Non-core Expenses
Engaging Employees
Formal Education vs. Street Smarts
Finding Good Employees
Corporate Retreats

Engaging Employees
November 2007

The surest path to employee engagement begins with the organization’s senior leaders understanding the strategic importance of developing a highly engaged workforce, and committing to make it happen.”
- Mark Phelps and Kim Brossoit, Ph.D., Development Dimensions International

In recent years, a number of corporations have shifted HR efforts from simply increasing employee satisfaction levels to ensuring that employee engagement is pervasive, since this latter strategy is believed to have a stronger impact on an organization’s bottom line. Whereas satisfied employees may be content with their jobs, engaged personnel go that extra mile - they are emotionally connected to their place of work and strive to ensure that the organization succeeds.

More specifically, Tim Rutledge, author of Getting Engaged: The New Workplace
Loyalty, defines employee engagement as being attracted to, and inspired by, the work (“I want to do this”), committed (“I am dedicated to the success of what I am doing”), and fascinated (“I love what I am doing”). Engaged employees generate high-quality, committed service and form work teams that produce high-quality results.
Conversely, disengaged employees simply put in their time at best (i.e. function as task workers), and at worst, undermine the organization (e.g. they may bad-mouth individuals, spread rumours and/or gossip). The negativity propagated by disengaged workers is believed to have dire financial repercussions, notably since this type of attitude is highly contagious. In fact, it is believed that 72% to 87% (depending on the study) of all employees in the U.S. are “neutral” or disengaged workers, leading some analysts to estimate costs in the billions of dollars for the American economy.
So how does a corporation build engaged, high performing workforces? According to “Employee Engagement: The Key to Realizing Competitive Advantage”, organizations must have the right employees in the right jobs (i.e., individuals who have the skills to do the job and have jobs they find personally motivating), effective leadership (i.e. supervisors who act as proactive coaches, but who also hold people accountable for their performance), and organizational systems and strategies in place
(e.g. hiring, promotion, performance management, recognition, compensation, training and career development systems).
Having said that, employers must ensure that they do not promise too much and deliver too little. Studies conducted by the Harvard Business Review have concluded that “those who cared most about their work were the most demoralized when they were thwarted from doing their best” by factors beyond their control such as role ambiguity, inadequate resources, and overwork.

And in the end, there are some situations that no level of HR initiatives can overcome. As Totus Consulting noted in their review of employee engagement research:

“Do you need a survey to tell you that the engagement level of the US soldiers is low in a war that they do not want to fight?”

“Do you need an expert to tell you that the engagement levels of the employees working in the corporations whose CEOs are in prison is low (and there are many, we understand)?”

“Do you need a model to tell you that the engagement levels of employees in Corporations whose jobs are migrating to countries like India is low?”

“Do you need to think hard before concluding that Manpower Inc (the largest employer in the US) will never feature as a great place to work because their employees work for others!”

Formal Education vs. Street Smarts
November 2005

Bill Gates of Microsoft Corporation, Larry Ellison of Oracle Corporation, Michael Dell of Dell Computer Corporation and James Halpin of CompUSA have at least one thing in common: they are all very successful CEOs, yet none of them has a university degree. These individuals are often cited as examples of the kind of success that is achievable in spite of (or perhaps because of) no formal education.

Is a formal education necessary, or are “street smarts” a better indicator of success in the business world? A study conducted in 1995 by the U.S. Census Bureau found that the majority of managers surveyed considered job experience a more effective screening criterion for new hires than grades or years of education completed. In fact, a director of employment for Apple Computers has said that that “without work experience and other practicum, to be honest, a college degree is really like a high school diploma.”

Formal Education and CEOs
Is post-secondary education simply superfluous? Are Gates, Ellison, Dell and Halpin proof that formal credentials are not necessary? Maybe not. How many other successful CEOs without degrees come to mind? - likely very few. Over 90% of CEOs in the United States have a university degree and half (50%) hold advanced degrees. Among those with advanced degrees, 68% hold an MBA2. And while the aforementioned men relied on their vision, perseverance and belief in themselves to succeed in the business world, most employers regard a degree as testimony of candidates' intellect, ability to learn and commitment to finish what they start.

Economic Indicators
That Gates, Ellison, Dell and Halpin are the exception rather than the rule is borne out when looking at income levels. If income is used as an indicator of success, then those with a university degree tend to fare much better than those with a high school diploma or less. In 1998, the median income of bachelor degree recipients in the United States was $46,285, nearly $20,000 higher than the median income for workers with only high school diplomas. Those with a university degree are also more likely to remain in the workforce and stay with the same firm (as opposed to involuntary job changes). Moreover, increased education levels in the U.S. are estimated to have contributed up to 25% to that country’s economic growth.

A Starting Point
Having said that, a formal education is best viewed as a starting point for a successful career (albeit, “an essential starting block”, according to the CEO of Enbridge). As Dave Opten, CEO of online job board Execunet notes, what and where someone studied is irrelevant five years after graduation. "They’re judged by their track record," Opton says. "If anything, the fact that they’ve gone on and gotten their degree can only be seen as a plus."

Where Street Smarts Come In…
Moreover, a formal education without corresponding “street smarts” might very well be worthless. Emotional Intelligence (EI) – the elements of a person's intelligence separate from memory and problem solving (measures of an IQ test) - has been referred to as the new street smarts. Emotional Quotient testing measures a person's ability to perceive, identify and manage emotions, and it is a balance between IQ and EQ, or school smarts and street smarts, which psychologists believe determines success in life. A managing consultant for Microsoft in Cleveland notes that “people competing for top jobs must bring a complete skill set, not just skill. At Microsoft, sure, we grill people on their technical base. But that might be just two of seven interviews a candidate faces. The others are looking for breadth: The ability to sell ideas and yourself, the ability to react under pressure, the social skills that allow a person to empathize with customers. A college education provides the framework of that collection of skills that we’re looking for.”

EQ Wins Out
In fact, research has repeatedly shown the importance of EQ for career success. Stein and Book – authors of “EQ Edge” – believe that IQ accounts for a maximum of 20% of success in the workplace, while EQ accounts for 27- 45%.

And a study of workplace studies finds that computer programmers who score in the top 10% of EQ outperform the average EQ individual by 320%. The good news is that EQ can be learned, and improved throughout life. Emotional quotient strengths include self-control, trustworthiness, conscientiousness, adaptability and innovation. In sum, while IQ may get you hired, it’s your EQ that will get you promoted.”

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Finding Good Employees
May 2005

Organizations generally acknowledge that the calibre of a firm’s employees is a key factor in determining a company’s success. Chances are, the better the employees, the more successful the enterprise. Conversely, incompetent employees can have detrimental impacts on time, resources and money. Having said that, organizations also recognize that attracting and recruiting good workers is easier said than done.

Given this disparity, it is strongly recommended that businesses invest the time from the outset to find the most suitable candidates for a position. Just as businesses develop marketing plans, so should they develop recruiting plans. That is, a requisite when looking for a new hire should be to identify the type of individuals sought, establish where to find such individuals and how to reach them, and develop a proactive strategy to raise potential employees’ awareness of an organization’s distinctive qualities.

Defining and Finding Potential Hires
When thinking of the ideal candidate for a position, a firm should look at the attributes of its best employees, and try to encapsulate these qualities in the job description (e.g. education, work history, job skills, professional affiliations, personal interests, etc). There are many avenues in which to find potential hires: temporary personnel agencies, employment agencies, headhunters, internal candidates, the organization’s own website, job websites, newspaper advertising, professional societies, employee referrals, internships, etc. Again, an enterprise should look at how it found its best employees, and subsequently develop a list of the top three or four sources.

Selling the Organization
Some believe that the best employees are already employed, working for a competitor. This makes it that much more essential to create an enviable working environment, in order to appeal to the currently-employed as well. This can be achieved, in part, by creating a job with great pay, benefits and training. As well as offering good benefits and perks, a company should recognize that an employee comes first, not the customer. If a company wishes to attract quality employees, the reasoning goes, the company must be of the same calibre. This means treating employees like people, with consideration given to their thoughts, wants and suggestions. Managers need to consider employees as their internal customers, providing support and encouragement when needed, and creating an environment where pride and enthusiasm thrives.

Speedy Process
When deciding to fill a position, organizations need to move quickly. In a survey of its Preferred Members Top Echelon Network, Inc., the world’s largest network of professional recruiting firms, found that 94% of recruiters surveyed encourage telephone interviews within five days of becoming aware of a qualified candidate, 86% encourage face-to-face interviews within eight days and 79% encourage extending an offer within six days of the face-to-face interview. Otherwise, companies risk losing the best candidates to competitors.