Part V—The Results
By Blake DuBose and Mike DuBose
In 2007, we set out to build a great family of companies with employees who exceed customers’ expectations. Our hypothesis was that if we had happy employees, they would provide better customer service, thus creating happy customers and ultimately, profit. As it turns out, we were right! (You can view the December 2007 speech where Mike set the goal for a positive culture under the “Articles” tab).
We had realized that our companies, while very profitable, had toxic cultures. We developed a series of strategies to get back on the right track, which are described in the first four parts of this series (which can be found at www.duboseweb.com, along with the employee survey we recently used to measure staff satisfaction in June 2011).
Two books proved to be catalysts for many changes we made in 2007: Good to Great by Jim Collins (which studied successful businesses and how they got to that point) and Execution: The Discipline of Getting Things Done by Larry Bossidy (who served as CFO of General Electric when Jack Welch was CEO) and Ram Charan. Every business leader (and employee) should read these two books!
Recently, we read another excellent bestseller called First, Break All the Rules by Marcus Buckingham (who works with the Gallup Organization, the most experienced survey firm in the world) and Curt Coffman. The authors conducted in-depth studies of 25,000 small and large businesses over long periods of time. When the dust settled and all the research was in, they made a discovery—in order to attract and keep happy, talented staff, it all boiled down to ensuring that twelve questions were addressed satisfactorily.
Surprisingly—and unbeknownst to us—most of these twelve questions were addressed by our 2011 employee survey. They include (in the context of a work environment):
- Do I know what is expected of me?
- Do I have the resources I need to do my job right?
- Do I have the opportunity to do what I do best every day?
- In the last seven days, have I received recognition or praise for doing good work?
- Does my supervisor or someone else seem to care about me as a person?
- Is there someone who encourages my development?
- Do my opinions seem to count?
- Do the organization’s mission and purpose make me feel my job is important?
- Are my co-workers committed to doing quality work?
- Do I have a best friend at work? (This was interesting!)
- In the last six months, has someone talked to me about my progress?
- This past year, have I had opportunities to learn and grow?
You may be asking, “What about salaries, fringe benefits, titles, power, office space, and prestige?” None of these factors made the list. Of course, they are somewhat important, but to create a great culture where people look forward to coming to work most days, you have to pause and understand what is REALLY important to them. Buckingham’s research found that leaders should not follow the traditional hiring path that most of us are taught. Like Jim Collins, Buckingham determined that great companies find the right, talented people with the best attitudes and then place these individuals into roles that allow them to thrive based on their strengths. After thirty years of being in business, we have found this to be true. The most educated, experienced, and intelligent employee may not be the best hiring choice. Instead, employ talented individuals who fit into your culture. Then, the rest will be much easier.
Buckingham reports that much of a company’s value “lies between the ears of its employees.” This means when a staff member quits, that value is gone too (often, according to Buckingham, “straight to the competition.” Therefore, leaders and managers should focus a great deal of their energy on creating cultures where the right employees will stay and continue to contribute.
Profit should not be your mission or purpose, but we all know it is needed to keep the company alive and well. Buckingham references a Gallup study of business chains with multiple locations, all of which had identical layouts and sold the exact same merchandise. At the stores whose employees scored their culture as “good,” profits were 14% over budget. Those stores that scored culture lower, however, reported profits 30% under projections. Customer satisfaction was much higher and employee turnover significantly lower in the stores with good cultures. Buckingham found that engaged employees connected better with their customers and were higher performers. Therefore, the right cultures equal higher profits. Southwest Airlines is a master of these concepts. While many airlines were losing money during the Great Recession, Southwest was profitable—because of its culture.
The most talented workers are only as effective as their managers and leaders, hence why great companies employ both outstanding staff and excellent leaders. We watched the decline of our favorite restaurant this year in dismay when a new (incompetent) general manager was brought in from another city, bypassing several competent managers within the store for the promotion. Prior to his arrival, there was a great culture where staff laughed, joked with customers, smiled, and seemed to be happy with their jobs.
The new manager’s first move was to get rid of all the talented, very experienced waiters who had been there more than five years to save money. Little did he realize that many customers came to see those same people. We considered them family, and visiting the restaurant was one of the highlights of our week! Like us, others also came to the profitable restaurant to be a part of the culture. We knew more about several servers’ lives than we knew about some of our blood family members!
As things got worse, the restaurant’s staff became fearful. They quit smiling, engaged customers less, complained about the poor leadership, and left in disgust or were fired. Their loyal customers followed them to other restaurants. In a few months, the new manager destroyed a good, positive culture that had taken years to build. Unfortunately, we have heard the profits have left too!
The bottom line: Successful leaders focus on employees’ strengths and treat them as their first customers. They situate staff members in roles where they can thrive around their passions and expertise. This results in healthy cultures, which are the lifeblood of any great business. Build a culture right, and competent staff and customers will come. Build it wrong, and get ready for lots of trouble and few, if any, profits!
