Monthly Archives: April 2012

How The Trust Molecule Drives Performance.

This week there was a wonderful article byPaul Zak in the WSJ about the effects of the hormone Oxytocin on our behavior.

What he points out is that all human beings have the tendency to create Oxytocin when we feel loved, appreciated, or warmly touched and hugged.

As Paul points out in the article, this also means that when we trust people at work, they behave in a more trustworthy way. This biological effect describes why “empowerment” in the workplace can be a very good thing (when done in the context of the company’s values and mission).

But there is an even bigger story here.

We are just completing a major research study on the use of Rewards and Recognition in business. It turns out that companies spend more than $45 billion a year on these programs (averaging almost 2% of payroll!). And as our research shows, this enormous spending on things like service awards, recognition, free parking places, etc. doesn’t drive nearly the business result it could.

Consider the following data from our research:

  • 87% of all recognition programs are based on tenure (years of service)
  • Only 56% of programs recognize company goals in the program
  • Off-the-shelf (ie. pre-defined) programs actually drive no measurable business impact
  • Only 53% of employees believe their company has any recognition program at all
  • Only 17% of employees believe their managers know how to recognize them well.

On the other hand, this same research (which will be published in June) also shows that companies which fall into the top 15% in building a “culture of recognition” have 46% lower rates of voluntary attrition. These are companies that regularly appreciate and thank their people, and this drives engagement, retention, and 12-15% improvements in overall employee performance.

Where does Oxytocin fit in? When people feel appreciated at work, we appeal to their higher level needs. In Maslow’s hierarchy, the highest level needs we have are the need to be loved, be part of a community, and to self-actualize.

Modern and sound employee recognition programs appeal to these higher level needs, making people feel good, and in turn work harder, take better care of customers (and each other), and make your business better. Look at companies like Deckers Outdoors, the company which makes Uggs and Teva Shoes.  This is a company that loves their employees, and they compete vigorously with hundreds of bigger firms.

Our research also finds that modern recognition programs are dramatically different from the old “service award” programs (which probably started in the early 1900′s to placate labor unions). They are given by employees to each other, they are given frequently and for very specific work, and they align with company values and goals, not just general “nice things.”

Think about how you recognize and thank people in your workplace. A little extra love goes a long long way.  Source/Credit: Josh Bersin for Forbes.

New Job Offers For Fired Secret Service Agent’s ‘Trained Eyes.”

In the wake of the Secret Service prostitution scandal, several agents have already been fired, but new opportunities are already becoming available for them.

Several of the Secret Service members have already been offered jobs that would use their keen instincts and eagle-eyes to help spot top-quality escorts, according to various media outlets.

The escort website Adult Search sent the letter to the agents offering them positions as “reviewers” of potential entertainers.

In the letter, the owner of Adult Search tries to convince the ousted agents in joining their company because of the skill set that they possess.

It explained that the agents “trained eyes can tell the difference between a common prostitute (since prostitution is illegal and we don’t condone it) and the legal adult escorts we list,” according to the letter obtained by TMZ.

The escort that was involved in the incident has not fared quite as well.

Diana Suarez, 24, became the focal point of the Secret Service scandal when several agents were discovered to have been partying in Cartagena before President Obama’s arrival for a Latin American conference.

A lawyer who is representing her said that she left Cartagena after several photographs were published showing her posing provocatively in high heels, and one photo showing her in a bikini.

“Put yourself in her shoes,” her lawyer, Marlon Betancourt said. “Her photo out there has caused her too much stress.”

The situation escalated after a dispute involving money owed to Suarez. Reports indicate that Suarez agreed to be paid $800 but when she was only offered $30, she refused to leave the room.

Local police were called and Suarez finally left the room, but it was too late, as word of the situation reached the American embassy.

“It was the first time this ever happened to her,” taxi driver José Pena, who drove from the hotel, told The Post.  Source/Credit:

Preparations Under Way for New Union Vote Rules Next Week.

Labor-relations consultant Phillip Wilson has had a busy month, flying from Arizona to Virginiaholding seminars and conducting online workshops to get employers ready for what he says is one of the biggest changes in labor law in decades. The flurry of activity stems from preparations by employers across the country for National Labor Relations Board rules to speed up union organizing elections that are set to go into effect a week from today. Members of the International Association of Machinists (IAM) enter the IAM Seattle Union Hall to vote on a labor agreement with Boeing Co. in Seattle, Washington. Photo: Stuart Isett/Bloomberg

The regulation will simplify union-election procedures and shorten the time for balloting after employees request a vote. The compressed schedule, which may cut in half the time permitted for voting to as few as 15 days, could tilt votes in favor of unions at a time when their share of the workforce is falling, Wilson said.

“The compressed election rule is a huge change,” said Wilson, the vice president and general counsel of Labor Relations Institute Inc. in Broken Arrow, Oklahoma. “It’s a dramatic new way in the way elections are held.”

Lawyers and consultants are rushing to educate employers on the new ground rules. Because they will have less time to make a case against collective bargaining, they should have arguments ready before the workers seek a vote, lawyers say.

Less Time

“This is going to make elections a lot quicker and employers will have less time to communicate with workers,” said G. Roger King, an attorney with Jones Day in Columbus, Ohio, who represents companies in employment matters.

Unions argue that reducing the time to hold an election limits the ability of managers to intimidate workers.

“The rules will make the process a little freer, with less frivolous delays,” said Elizabeth Bunn, who heads organizing for the AFL-CIO, the largest American trade union federation.

Some Republicans and business groups such as the National Association of Manufacturers counter that the labor board has created “ambush elections.” The U.S. Chamber of Commerce has filed suit to block the rule and is awaiting a ruling from a federal judge in Washington.

“We just want a fair process, a chance for the companies to make their case,” said Michael Eastman, the chamber’s executive director for labor law policy said in an interview.

Disapproval Resolution

Additionally, Republican Senator Mike Enzi of Wyoming sponsored a resolution of disapproval of the election rule, saying the standard leaves little time for workers and employees to learn their rights. The proposal, backed by 43 other Senate Republicans, is scheduled to be voted on tomorrow.

“The changes that are being made are going to be a big surprise for employers and employees who are caught in this net,” Enzi said today during Senate debate.

Advisers to President Barack Obama would recommend that he veto the resolution should it pass, according to a statement today from the White House Office of Management and Budget.

“The administration is committed to supporting the right of workers to join and participate in a union and bargain for fair wages, benefits and a safe workplace,” according to the statement.

The rate of union membership in the U.S. fell to a record low in 2011 for a second-straight year, according to the Bureau of Labor Statistics. The total union membership rate — reflecting both public and private-sector workers — was 11.8 percent, down from 11.9 percent in 2010, though the number of unionized workers went up by about 50,000, to 14.8 million.

Declining Membership

The speedy election rule is unlikely to stop the decline of unionization rates in the U.S., Jeff Farmer, the director of organizing for the International Brotherhood of Teamsters, said in an interview.

“It’s a small step in the right direction,” said Farmer. “But we’re under no illusion that it will fundamentally change the equation with workers.”

Workers will still be intimidated by managers discouraging collective bargaining, said Bunn. Employers and managers will have ample time to influence the outcome in the days or weeks before the vote is held.

“Even shortening it by one day is one day that intimidation doesn’t happen,” Bunn said in an interview.

Unions win 87 percent of elections held 15 days or less after a request, a rate that falls to 58 percent when the vote takes place after 36 to 40 days, according to a February report by Bloomberg Government.

Union Victories

About 60 percent of the 1,706 representation elections in 2010 went in favor of unionization, according to the most recent data available from the NLRB.

Nancy Cleeland, a spokeswoman for the Washington-based agency, said 90 percent of the elections won’t be affected by the new rule, as they occur after management and unions agree to a schedule. The labor board plans to provide guidelines on the rules to its regional offices this week.

A separate rule was also scheduled to go into place April 30 which would have required employers to tell workers their labor rights on a workplace poster. An appeals court in Washington last week granted a request by employer groups to put the rule on hold until legal challenges are heard.

Wilson, who helps employers in labor strategies, said companies have little to fear if workers are content with their managers. Managers should be trained to recognize workers’ concerns and address them before support builds for a union.

“The No. 1 thing they need to do it work on the frontline supervisory group,” said Wilson. “If they’re doing a good job, they don’t have to worry about unions.”  Source/Credit: William McQuillen for Bloomberg.

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