Employees Are Your Best Consultants

The best consultants for your business are your employees. They can help you with a wide variety of issues because they deal with them every day. Many times employees have great ideas, but are reluctant to come forward out of fear or simply because they feel their ideas won't be taken seriously. Develop a system that requires and allows all employees to be active "internal consultants". Suggestion boxes and anonymous systems tend to not work because employees don't feel compelled to submit ideas. Or they have in the past and their ideas have been ignored or someone else took credit for them. Setting up profit teams that submit and refine suggestions works in some organizations. Requiring work units to submit suggestions for their own areas on a defined, regular interval has worked well in others. In both cases, making suggestions and developing ways to enhance profits become a part of every employee's job.

Create a reward system that pays all employees for enhanced profitability. Make the rewards significant enough to incent the employees. Profit sharing is most common, but you can also pay on cost savings, productivity gains or any other unit of measure that makes sense for your company.

What Makes 360 Degree Feedback Work?

The use of 360 degree feedback surveys has grown and is continuing to grow at a very fast rate. The idea of surveying employees isn’t new, but the notion of having multiple employees rate a specific “target” employee to provide as much unbiased input about that person’s performance is a relatively young concept.

But why does 360 degree feedback work and what can it do for an organization? Before answering the question of why 360 degree feedback works and what it can do for an organization, it probably makes sense to describe and define what it really is.

The term 360 degree implies a circle of raters surrounding the “target” employee providing anonymous feedback. A department manager, for example, likely has peer managers, subordinates, and superiors. Using a traditional definition of 360 degree feedback, some or all of the people “surrounding” the employee will be invited to complete a rating and comment survey form on critical competency areas for the employee.

But any employee level can be selected for receiving feedback. Even when an employee has no subordinates, peers and superiors can certainly provide sufficient feedback in most cases to help the employee better understand his or her strengths and weaknesses.

And it is not out of the realm of reason to include people outside the organization such as vendors or customers to participate in the feedback. While this is not all that common, the feedback from familiar “outsiders” can be beneficial to the process.

The raters selected should have direct experience working with the “target” employee on an ongoing basis. Certainly the biases of the individuals completing the feedback will enter into the process. This is why it is important to get enough people involved to smooth out some of the inherent bias involved in a survey scenario.

In a 360 degree feedback survey, the ultimate objective is to gain a clear understanding of how others within the organization view the performance of the “target” employee relative to specific competencies or performance factors such as those related to accountability or cooperation. The raters provide a rating (generally on a 1 to 5 scale) based on their perception of the employee’s performance for each of the competencies listed on the feedback form. And there is usually room for overall comments at the end of the survey form. Of course, all of this is done anonymously and the employee will see the average ratings for each competency as well as a compilation of the comments offered. The results are then used in the creation of a development plan for the employee that will focus on strengthening areas that may be in need of attention.

Now that we have identified the basis process involved, the real question of what makes 360 degree feedback work and how the organization will benefit remains. There are several critical factors that will help ensure successful implementation of 360 degree feedback in your organization:

-Cultural integration. 360 degree feedback must become a part of the organization’s culture. This is accomplished by very clearly communicating what it is, why it is being done, and what the intended uses of the results are. But it doesn’t end there. To truly achieve integration into the culture, there must be consistency in using the tool and development plans that address deficiencies must be put into place and then completed. Keep in mind that the objective is to provide feedback that will help the employee become more aware of his or her behavior and performance levels and then enhance performance.

-Accountability for participation. Since having enough diversity in raters is important, it is critical that the raters understand that when they are invited to provide feedback by a certain date, they must not ignore the request. Expectations must be made very clear to all employees about the importance of 360 degree feedback and the need for timely completion of the surveys.
Relevance of the competencies. Developing the survey form is not complicated. But it is important to make certain that what should be measured is actually measured when selecting competencies to include in the survey. Making the survey forms specific to each position is one way to help ensure that job-specific competencies are being evaluated.

-Simplicity. If the process is too complex, acceptance will be hard to gain. Using an automated solution is usually best since they usually include automated notifications and carry out all of the calculations and compilation of results. Manual processes can be cumbersome and time consuming and can put a damper on long-term integration into the organization.

-Positive results. Like most activities, 360 degree feedback cannot be perceived as nothing more than an exercise. It must be perceived as a viable and useful tool that helps employees get better at their jobs. If nothing happens after the feedback is obtained, employees will begin to perceive it as just another useless exercise. Make certain that the feedback is used to create sound development plans that are then implemented. Over time, incremental improvement will occur and employees will see real benefit in participating in the process.

These are just some of the factors that will help your organization implement a successful 360 degree feedback process. As with other programs, commitment and attention to detail will help cement it as a viable and beneficial tool.

On-demand, web-based solutions such as ReviewSNAP (www.reviewsnap.com) offer excellent automated 360 degree feedback tools. They offer a free trial and “live” demos so that you can see how the system might benefit your organization.

ReviewSNAP Price Increase - Lock In Now

ReviewSNAP™ has recently launched several enhancements and modules to our Web-based performance management system. These include:

•eSignature to help you make your performance review process completely paperless.
•Comment suggestions to help managers/reviewers find just the right verbiage to support ratings.
•Employee import feature that allows you to import your existing employee information to the system.
•Logo upload that lets you personalize the system and review templates to your specific organization.

Also, we will soon be launching our compensation recommendation tool. This enhancement will allow you to create recommended percentage increases for employees’ compensation based on overall ratings. This feature can be turned on or off at your discretion.

As you may know, ReviewSNAP360™, a complete 360 degree feedback module will be bundled with the current performance review solution. It will afford your organization the opportunity to gather important feedback from superiors, peers, and subordinates on employee levels including managers, team leaders, group supervisors, and other staff levels of your choice.

Our goal is to offer the most powerful and flexible system possible at the most affordable prices. Due to the recent enhancements and the imminent release of ReviewSNAP360™, annual subscription rates will be going up.

Since you are currently or have been a free trial member we are offering you the opportunity to subscribe to ReviewSNAP at the current subscription rates until 11/15/2008. If you do subscribe to ReviewSNAP prior to the 15th and don't exceed your initial employee limit, you will be locked in at that price for annual renewals.

Although our prices will be changing they will still remain the most affordable on the market and you will have access to the most powerful version of ReviewSNAP yet.

Business Problem: High Employee Turnover Quick Tip

A common problem in many organizations. Employee turnover is very costly to any organization. Keep in mind that employee turnover is generally the result of more than one factor. Follow these steps in assessing and dealing with this problem:

1. Ask the employees how they feel about working for the organization. This can be accomplished in several ways, but anonymity is often important because employees often fear retaliation from superiors or peers. Keeping this in mind, it is best to conduct an anonymous survey of the employees. You will want to assess how they view the organization's working environment, their superiors, communication, perceptions about how they feel they are valued by the company, benefits, compensation, attitudes toward company policies, their comfort level with their peers and with their current position as well as other factors specific to your organization. Carefully plan your approach to carrying out the survey process. Employees must feel that they can speak their minds, so to speak. If they don't, the results will be less meaningful. Compile the results and take them seriously. Don't dismiss the results as inaccurate and don't let your ego get in the way of taking the results to heart. If there are issues that really stand out, deal with those first. Prioritize them based on the apparent severity of the problem based on responses to the survey. Methodically develop a plan for dealing with the problems and communicate that plan to employees. The worst thing you can do is conduct a survey to seek input on employee satisfaction and then do nothing with it.

2. Assess your compensation structure relative to your market. If you are paying employees below market wages, the likelihood of employees leaving increases dramatically. While money is probably not the key motivator for employees, they do expect to be paid fairly. That is a given in their minds. Market data is available from a variety of source, but be careful which sources you use. You would be well advised to hire a firm that specializes in compensation work to provide you with the information needed by type of position. If you find you are not meeting market pay scales, develop a plan to get there or beyond. What you spend to get there should be offset by reduced turnover and less "moaning" about wages, therefore productivity should increase if only slightly. Don't underestimate the amount of time employees spend complaining about various things. Don't give them a reason to sit around and complain about their wages relative to the market you operate in.

3. Determine how well employees are suited to the jobs they hold. Almost without exception, the key factor in employee turnover can be traced to ineffective hiring and promotion practices. All too often employees simply do not match the jobs they hold in terms of their intellect, what interests or motivates them and their personalities. In other words, too many employees just are not cut out for the jobs they currently hold. This sets the employee up for failure and certainly impacts the performance of the business. Look at your hiring process. Is sufficient effort really being put into it to determine how well someone will match the job being hired for? What criteria are you using to hire people for various jobs? If your number one criterion for hiring boils down to knowing something about the type of business you are in, this is a prescription for trouble. You can teach a bright person your business. You can't teach them intellect, to be interested in what they do or change their personality. These factors are really the keys to how well someone matches a particular job. Structure employment searches to find people who have the appropriate level of mental ability, a strong interest in doing the type of job being filled and a personality well suited to that job. While it is nice to find someone who has experience in your industry, this should not be the primary factor in hiring. In fact, someone who matches your job well in terms of the factors mentioned above with virtually no experience in your type of business will almost always outperform someone with experience in that industry, but who is a poor match for the job. This requires a shift in thinking in many organizations. Too many owners and managers get hung up on finding people who know their business. Again, bright people can learn your business relatively quickly. Don't get caught in the "my business is unique or complex" trap! When promoting people, you should look for people who match the job being promoted into. Every day we see people who were high performers in one job being promoted into jobs they have little chance of being successful in because they don't match the job. There are several good to excellent assessment tools that help match employees to jobs that can be used in the hiring and promotion process. These tools are critical in augmenting your decision process in hiring and promoting employees. For more information on these tools, see Assessments on this web site.

4. Look at your turnover statistics. Is turnover higher in certain work units, departments or divisions? If so look more closely at the makeup of those areas. Often there is a problem with a manager or supervisor in terms of how they deal with their employees. Or it could be a peer who is a problem employee but is not being dealt with by management. Is your work environment in those areas conducive to a pleasant, productive work day?

5. Overall culture of the organization has a lot to do with employee satisfaction and turnover. What kind of atmosphere exists within your company? Is it pleasant, productive and light or is it heavy handed, gloomy and generally unpleasant? Employees need an environment where they can thrive and feel good about coming into work. By the way, it's ok to introduce some fun into the work day. Take an objective look at your environment.

Employees and Profits

Success in business is almost entirely dependent upon the quality of the people a business employs. Those that hire and promote people who fit their jobs well and are considered high performers tend to do well. Those that have a casual attitude about hiring, training, retaining and promoting high performers tend to struggle. While product/service offered, the economy and a little luck often play into the success of the business, it is people that determine its long-term success. Far too many businesses do not do a good job of hiring the right people for the job. They then compound that problem by retaining employees who have little or no chance of being productive. We cannot stress enough the importance of taking enough time and working hard to hire the best people possible.

Your people are the key to your success (or failure). Why anyone hurries the hiring process is mind-boggling to say the least. Even in a tight labor market businesses want to hire the best of what's available.

Here are some tips for hiring good people:

-Be patient. Don't hurry the hiring process. We believe you are better off with a vacant position than having a marginal employee filling it.
-Develop a complete and accurate position description that details all aspects of the position.
-Develop what you feel is an ideal profile of the person that will fill the position.
-Utilize an employee assessment instrument in the hiring process. These tools are essential to uncovering a person's interests, ability and personality. The best instruments provide a profile of the individual against the ideal profile for the job.
-Spend a little extra time and money attracting as many quality candidates as possible. You will want to be able to select from as many good candidates as possible.
-Be prepared! Develop interview questions prior to any interviews. Focus on the desired traits and profile when developing interview questions. Design the questions to draw out traits and tendencies. Get at the past behavior of the candidate in the interview process. Have candidates explain situations they have dealt with in the past that are relevant to the job you are hiring for. -Put the candidates through a series of what if questions. These are situational in nature and force the candidate to think about what he/she would do in each situation.
-Once you have boiled the candidate field down to just a few people, bring the finalists back for a second round of interviews.
-Have several people interview the candidates. This allows for different perspectives and accounts for various biases.
-Examine your wage/salary and benefits structure. Are you at least competitive with the market? The best people will be attracted to the highest paying positions in most cases.
-Think long-term. Ask yourself if hiring the candidate is in the best interest of the organization. -Remember that hiring marginal employees has a devastating short and long-term impact on a business.

Don't Short Change Employees

Your employees are your most important asset. While the primary mission of any business is to make money, we don't recommend doing it at the expense of employees. In other words, holding employee wages down to boost short-term profits is usually a big mistake. We emphasize looking at the long-term. Paying employees at levels that are not competitive is not a good long-term strategy for enhancing profits. It is critical that wage and salary structures be sufficient to attract and retain top people. Without excellent employees, the likelihood of success is not very high. Ultimately the less competitive your wages are the worse your employees will be, meaning you get what you pay for. Poor wages are going to cause you to lose the good employees you already have and make it difficult to find more good employees.

Strive for Higher Levels of Productivity

Employee productivity is one of the most important factors in overall profitability. When employees are highly productive, products and services are sold at a faster rate, overtime is reduced, staffing is kept lean and the customer is more satisfied. Productivity is often overlooked as a key variable in enhancing profitability. This web site includes a number of articles dealing with this issue.

Productivity is directly related to the quality of employees hired and the management of those employees. Establish productivity standards and expectations for all functional areas within your company and then measure performance against those standards/expectations. Identify the key productivity indicators that you will measure. These indicators can be any units of measure that makes sense for your business. But the important thing to keep in mind is that productivity isn't something to merely talk about. It must be measured and managed. And employees should be evaluated and rewarded based on their level of productivity.

Avoid Duel Reporting Relationships

Put yourself in the shoes of your employees. Would you want to be subjected to having two or more bosses? Some organizations do, in fact, have an ill-conceived organizational structure that calls for an employee to report to more than one supervisor.

Since this situation nearly always creates confusion, conflict and indecision, it is wise to avoid it completely. An employee might have responsibility across two or more functional areas. But does that mean the employee must take direction from more than one supervisor? Rarely. It is vital that employees work closely with one supervisor to set expectations and goals, take direction and receive feedback about performance. When more than one supervisor is involved, the employee is subject to the potential for far too many mixed messages.

Because management styles can vary widely, the employee is subject to differing approaches. Supervisors who are expected to manage the same employee can become frustrated, angry and possessive leading to potential conflict with the other supervisor(s).

Look for situations in your organization where there are formal or informal duel reporting relationships. Work closely with the supervisors involved to resolve the reporting relationship. Many times employees are taking direction from more than one supervisor without the formally designated supervisor being aware of it. The employee continues to take direction often out of fear or confusion about who he/she reports to.

Clearly define the organizational structure for each work unit in your business. Keep the structure as simple and easy to administer as possible. Once completed, communicate it very carefully and completely to all employees. Supervisors and employees must understand who reports to whom.

If, for some odd reason, an employee must report to more than one supervisor, it is essential that the supervisors work together closely to define each of their roles in the relationship with the employee and to break down responsibilities. This is often best accomplished with the supervisors' manager involved. Once the details are worked out, they should be communicated clearly to the employee.

Promote An Employee Only When They Are Qualified

We believe strongly that the number one reason businesses struggle or fail is due to ineffective management. There is little doubt that most businesses do a poor job of hiring and promoting the right people into management and supervisory slots. This article focuses on promoting employees into management primarily because there is overwhelming evidence to indicate that most of these promotions are given based on improper criteria.

The most common reason businesses promote an employee into management is longevity. The prevailing attitude is that someone who is loyal should be rewarded by being moved into a management role so they can make more money and be given an incentive to stay on. The unfounded fear is that if the employee isn't promoted they will go elsewhere. Our first rule in promoting employees is that longevity should play a secondary role in the decision to promote. In fact it should be used only in the case where two or more employees are vying for a management position and all are equally qualified to be promoted. Rewarding long-term employees by promoting them into positions they are not well-suited for is unfair to the employee, fellow employees and the company.

Another common reason people are promoted is because they are well liked. Being well liked in and of itself is not a reason to promote someone. Certainly if the employee posseses the requisite skills and profile to be an effective manager they should be considered for the promotion. However, it seems that too many owners and managers promote people because they like the person. They want to reward the individual for making them feel good and for being a good team player.

Some employees are promoted because they are doing an excellent job in their current positions. But does that alone indicate they will be effective at the next level? Absolutely not! Many employees that are effective in their current positions fail miserably as managers and supervisors.

So when does it make sense to promote from within? It only makes sense when an employee has the ability to manage effectively. That means that all of your personal biases about employees must be shelved when making promotional decisions. It means that unless an employee is an excellent fit for the job they shouldn't be considered for the promotion.

The problem in hiring and promoting employees is that gut feelings and subjective criteria are too often used in judging whether someone can move into a management role and be effective. When promoting employees, they should be taken through a rigorous process to determine their chances for success in a management position. The employee should be expected to interview with top management and should be put through the paces to isolate behavioral tendencies that will give some indication about how they will handle various management situations. And the employee should be tested and assessed to determine the degree to which they match the profile of a manager/supervisor.

Most promotional decisions are made too quickly and without sound rationale. Putting some structure and objectivity into the process will help immensely in making the right decision. And we need to realize that some employees will be passed over for promotions into management simply because they are not qualified to manage. Will they leave the company if they can't advance into management? Maybe. But would you rather have an employee leave or have them attempt to fill a role they are not capable of filling? If they are promoted and are not capable of doing the job, they can do a significant amount of damage and you will have done nothing more than set that person up to fail. They will ultimately be demoted or terminated. Handled properly, an employee passed up for a promotion will often stay with the company.