Press
Releases
For Immediate Release: April, 2007
For a review copy of the book
or an interview with the author,
please contact Dottie DeHart,
DeHart & Company Public Relations,
at (828) 325-4966 or DSDeHart@aol.com.
Rules of Engagement:
Three Simple Tips For Engaging Employees and Working Toward Consistent
Organic Growth.
Highly engaged employees are the "magic bullet" for
organic growth. Author Ed Hess explains how to ensure
If you want to grow your business the old fashioned
way-by serving more customers and selling more products-you've
got your work cut out for you. Consistent corporate organic growth
is challenging today due to global competition, market saturation,
low inflation, as well as the demographics of the industrialized
world. The larger the business, the more difficult it is to sustain
high growth rates over long periods of time. But according to
Edward Hess, organic growth is still possible as long as you have
one magic ingredient: engaged employees.
"Because of globalization, the commoditization
of labor, and the advent of technologically driven operating efficiencies,
the role of employees in achieving corporate growth has been devalued,"
says Hess, author of The Road to Organic Growth: How Great Companies
Consistently Grow Marketshare from Within (McGraw-Hill, February
2007, ISBN: 0-0714752-5-7, $22.95). "Many companies look
at employees as fungible assets. My research shows that highly
engaged employees are a necessity for consistent corporate growth."
First things first: why is organic growth desirable?
It's not that non-organic growth-growth created by accounting
elections, financial engineering, currency gains, accounting valuations,
related party transactions, or through serial acquisitions of
revenue-is necessarily "bad." It's just that growth
generated internally is better long term. As Hess's book explains,
organic growth is more likely to result in better returns on investment,
stock value improvements and lower employee turnover.
Now for a bit of background: In three separate
studies of over 800 high economic value-creating public companies
for the years 1996-2003, Hess was shocked to discover that less
than 4% of these companies consistently (1) created economic value;
(2) out-competed their competition, and (3) did this primarily
through organic, core, or internal growth.
In a follow-up study, he examined how some companies
achieved what others were unable to achieve: which was consistent,
high organic growth. In this study-the results of which can be
found his book-he looked at 22 repeat winners. One of the conclusions
drawn from this study is that consistent high performance businesses
are also great execution companies. And to be a great execution
company you have to have highly engaged employees.
"Great consistent high organic growth companies
have not lost sight of a plain fact: businesses are operated by
and through people, not machines - not management consultants
- and not by executives," says Hess. "Consistently outstanding
businesses like Walgreens, Best Buy, SYSCO, Outback Steakhouse
and TSYS are great people companies."
"By that I mean, they are led by executives
who are humble and home-grown, executives who have not forgot
that it is line employees who are the important people - not management,"
he explains. "As Brad Anderson, CEO of Best Buy, states:
'Our customers are Kings and Queens and our employees are Royalty.
Management people are servants to royalty.'"
Contrast this attitude to that exhibited by Best
Buy competitor Circuit City with its recent decision to lay off
higher paid store workers and replace them with lower paid hires.
Clearly, the "Best Buy" approach is more likely to result
in highly engaged employees-after all, if the company doesn't
care about you, why would you care about them?
So how can you ensure that your employees are
highly engaged? Hess offers several suggestions:
• Promote from within. "High employee
engagement companies enjoy employee loyalty, high employee retention,
high employee productivity, and they primarily promote personnel
from within," says Hess. "The power of promotion from
within, along with keeping the HR employee rules of the game stable
and consistent, shows employees that if they play by the 'rules
of the game' they will be treated fairly and have the opportunity
to advance and be rewarded for their efforts.
Companies like SYSCO, for example, understand
that people perform very well over long periods of time when they
realize personal results from their efforts. High performance
companies work hard at measuring and frequently rewarding the
right employee value-creating behaviors. For instance, over 95%
of SYSCO's positions are filled from within the company and over
65% of its employees own stock in the company.
• Provide a meaningful work experience. "Great
companies understand that great customer service, great daily
and consistent execution depends on line employees being emotionally
engaged in the business," says Hess. "And that only
happens when people think that they will be treated fairly, be
compensated fairly, and feel that they are part of something meaningful."
Meaning is often two/fold: first, employees want
to work for a company that is good and ethical and does good things.
Second, real meaning is gained from working at a company that
helps employees to accomplish their hopes and dreams for a better
life for themselves and their families.
• Consistently measure and reward good performance.
Great high growth companies evolve its growth system over time.
This system is internally consistent, linked, and self-reinforcing.
Culture, HR policies, measurement and reward systems are all linked
and consistent. Employees understand how their jobs create value.
And employees are measured frequently, receive frequent feedback;
and are rewarded frequently for the right behaviors.
"Great organic growth companies keep strategy,
leadership, HR policies relatively stable while demanding daily
iterative and incremental improvement from their employees,"
say Hess. "Employees tolerate high levels of daily execution
change because they trust the system: it is stable. They see home-grown
leadership who has not forgotten what it is like to be on the
line. They see promotions from within. They see results and feel
like they are more in control of their destiny."
Interestingly, some of the companies in Hess's
study manufacture their own products in the United States, rejecting
the premise that U.S. manufacturing can not compete. Stryker,
Tiffany & Company, Harley-Davidson, Gentex, PACCAR, and Waters
Corporation all have U.S. manufacturing facilities.
"A highly engaged U.S. workforce can compete
with anybody," asserts Hess. "It begins with highly
engaged employees. Engaged and energized workforces work harder
and serve customers better, and with more consistency. In summary,
great growth companies do not necessarily have the best talent
- what they do have is highly engaged talent."
About the Author:
Edward D. Hess, B.S., J.D., LL.M., is an adjunct
professor of organization and management and the founder and executive
director of both The Center for Entrepreneurship & Corporate
Growth and The Values-Based Leadership Institute at The Goizueta
Business School, Emory University. His organic growth research
has appeared in the Financial Times, Fortune magazine, and Fortune.com.
He is the author of The Successful Family Business: A Proactive
Plan for Managing the Family and the Business (Praeger, 2005);
The Search for Organic Growth (Cambridge University Press, 2006),
Hess & Kazanjian, eds.; Leading with Values: Positivity, Virtue,
& High Performance (Cambridge University Press, 2006), Hess
& Cameron, eds.; and The Road to Organic Growth: How Great
Companies Consistently Grow Marketshare from Within (McGraw-Hill,
2007).
About the Book:
The Road to Organic Growth: How Great Companies
Consistently Grow Marketshare from Within (McGraw-Hill, February
2007, ISBN: 0-0714752-5-7, $22.95) is available at bookstores
nationwide and all major online booksellers.
|
|
|
| |
|
|
|
Copyright © 2007
