NFIB

Blue Sky Thinking
07/ 30/ 2003

by Kathleen Landis

A national survey published in 2000 by the Gallup Management Journal, an online journal based on Gallup's research, reported that of all U.S. workers 18 or older, 24.7 million are "actively disengaged." They're less loyal, more stressed and less secure in their work, and they miss 86.5 million more days of work than average workers.

The good news in the depressing findings is that small businesses have an easier time fostering pleasant work environments, which ultimately lead to bigger profits.

"Small businesses are more likely to fail in hard times. But because they often foster more positive work environments, people are more willing to stay," says Marilyn Durant, director, human resources consulting at RSM McGladdrey Inc. in Ft. Lauderdale, Fla. "Make all employees a part of the company's success."

During the tough economy, you've likely pored over internal numbers, targeted new business and stretched dollars to their limits. But have you created the perfect work environment? Now is the perfect time to make your blue sky a reality. As MyBusiness found when we spoke with three award-winning small business owners, happy employees may what leads you to a pot of gold.

Star Search

"We're a services business, so our people are our most important product," says Celeste Ford, founder and CEO of Palo Alto, Calif.-based Stellar Solutions Inc.

(www.StellarSolutions.com), an aerospace engineering services firm whose clients include Lockheed Martin and NASA.

Ford catches stars at her 50-employee company by providing a flexible compensation and benefits package and by empowering staff members both at the customer level and also internally.

"Employees need to feel important, not that they're just filling a slot," says Ford, who has retained most of the original staff at her 8-year-old company. "People are a critical resource. If you treat them fairly and empower them to have high impact both within your company and with your customers, your company will succeed."

Stellar Solutions operates on a strategic three-year plan. During the annual planning meetings, employees help set an action plan for the coming year. Because everyone participates in these meetings, each person knows the company's course. Employees earn bonuses for satisfying customers or closing an action from the three-year plan.

"There isn't some elite group at the top that decides what work we will and won't do," says Ford, whose business generates $10 million in revenue. "When choosing the company's direction, we include the people who are on the front lines."

Not only do employees have a say about the company's direction, they also choose their own benefits packages. Through Stellar Solutions' Individual Benefit Account (IBA), employees have total flexibility over their benefits, which equal 25 percent of their base salary. The IBA covers everything from medical and life insurance to tuition plans and child care costs. "It's always been our philosophy to be better than the other choices," says Ford.

Through their hard work, Stellar Solutions employees earn money for themselves and others. Each person receives a multi-layered benefits package, a stake in Stellar Ventures, the company's venture capital arm, and a foundation that earmarks up to $1,000 per employee toward individual charitable contributions.

"I've always suspected that people had other things they worried about in their lives besides Stellar Solutions," says Ford, who established the Stellar Solutions Foundation when the company became cash-flow positive. "I was right."

Team Building

Employees at Woodpro Cabinetry Inc. (www.WoodPro.com), have been tested by fire -- literally. When a fire destroyed the bathroom-cabinet manufacturer's finish room in 1993, employees didn't skip a beat. By working around the clock, Woodpro delivered orders just one day late.

"It's a real-life story of a frightening time when our team really pulled together," says LeRoy Walls, CEO of the $10 million business based in Cabool, Mo. "We have a pretty motivated group."

How does Walls encourage such fierce loyalty? It's simple. He founded his 100-employee business on the idea that empowerment, recognition and communication are the keys to motivating your staff. He believes his employees want to do the right thing, and, if given the opportunity, they'll find ways to do things better.

"We're pretty much an open-book management company," says Walls, who prefers "coaches" instead of "supervisors." "Self-direction lent itself to the way we wanted to be as a workplace."

Walls looks to employees to suggest how the company can improve. To encourage suggestions, whether implemented or not, Woodpro awards $2 bills for each. Despite minimal reimbursement, ideas pour in. "The payment indicates that we're really interested in peoples' ideas," says Walls, who was the first cabinet maker in the country to merit OSHA's Voluntary Protection Program Award that recognizes facilities with exemplary health and safety programs.

Underscoring the importance of teamwork is the Quality of Life Club, run by elected members. The club, supported by canteen profits and company contributions, hosts an annual employee-awards banquet. Honors go to rookie of the year and coach of the year and to the employee with outstanding "spirit." The QOL Club also rallies team members for bowling, skating and family-oriented events. Another innovation is WINR, a company radio station that broadcasts weekly sales figures and production rates over the public address system.

Though Walls believes recognition is essential, it doesn't have to be expensive, he says. "A few $2 bills, a plaque, a T-shirt; those all make people feel important."

Culture is Cornerstone

Before he opened Cornerstone Consulting's doors, Perry Schroeder and his management team laid the groundwork for the company culture. "We relied on experiences from past companies and vowed never to do the things we didn't like," says Schroeder. "We did it all with a sense of purpose."

The plan works. The customized software development firm (www.Cornerstone.net), which generates $3 million in annual revenues, earned Milwaukee Magazine's "Best Places to Work in Southeastern Wisconsin-Small Companies" award in November 2002.

Besides a generous insurance package, Cornerstone's perks include an $800 annual consultant clothing allowance, an annual $1,000 computer reimbursement and paid parking, among others. "No companies our size offer benefits packages this good, and most companies that are quite a bit bigger can't match it," Schroeder says.

Schroeder recognizes that career growth is difficult in the Internet technology sector. "The career path for technical consultants isn't very glamorous," he says. So Cornerstone emphasizes training, and finds exciting projects for its consultants, who don't mind the boring projects as much when challenging ones follow.

"Deliver on your promise to treat your employees the way you want to be treated," says Schroeder. "If they see you doing that, you're going to get a lot more buy-in from your staff, and you're going to have a much better company."

5 Perks You Can Afford

Want to do something nice for employees that won't cost you a lot? Try these:

1. Recognize major life events such as marriage or the birth or adoption of a child with a small financial gift.

2. Say "Happy Birthday" by giving employees a paid day off on their birthdays.

3. Offer employees $100 a year for personal enrichment. Maybe they'll take an art class, get a massage or attend a play -- anything that makes them happy makes them more productive.

4. Bring bagels or donuts to work one Friday a month.

5. One good employee leads to another. Offer recruitment bonuses to those who refer potential employees who stay with your company at least six months or more.

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This article originally appeared in the June/July 2003 issue of MyBusiness magazine.

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