A New Space for the New Year
Filed Under: Human Resources
Tags: Human Resources
When the time comes to remodel your business’s office space, or to move into a new space, it is easy to think of the process solely in terms of cost. After all, no matter how nice a conference table or how attractive a desk you purchase, it is hard to imagine them adding anything to your bottom line. But by taking a holistic, rather than a piecemeal, approach to remodeling, and viewing your office as an asset that can yield returns in terms of efficiency, productivity, and employee performance, you can realize long-term cost savings and benefits from a well-planned office from the ground up.
If you are considering an office remodel then you’ll want to focus on maximizing the utility of the following features in order to get the best return on your investment.
Walls
Once you’ve owned your own business for some time—and been through the ups and downs of a few economic cycles—you come to realize that it’s not just the amount of space you need that can change, but also the way in which that space is configured. Moveable walls are a great solution that can save you a substantial amount of money compared to fixed walls, while also offering the flexibility to change the layout of specific spaces (e.g. from a set of private offices to a conference room) virtually overnight. Moveable walls come in a variety of durable materials and finishes including some that incorporate glass, allowing natural light to flow further into a large work setting.
Light
Increasing the amount of natural light that enters your workspace has myriad benefits. In addition to being aesthetically preferable to artificial alternatives, natural light will reduce your energy bills and has been shown to boost worker productivity. Besides designing your office to take full advantage of available natural light, installing a lighting system that works in conjunction with natural light by dimming or shutting off entirely when there is ample natural light can save you additional money on utility bills.
Floors
With an office remodel it’s not so much the floors as what’s underneath them that can add the most value. By taking advantage of raised-access technology it is possible to house the majority of your power, data, and communications cables underneath the floors and out of sight. On top of the obvious aesthetic benefit, the under-floor setup provides outstanding flexibility for the inevitable future configuration changes and furniture reshuffling. If you are doing a major remodel, or starting fresh in a new space, it is also worth looking into an under-floor HVAC (heating, ventilation, and air conditioning) system, which can offer increased energy efficiency, improved air quality, and a safer alternative to traditional wall-mounted systems.
Furniture
Outfitting your remodeled space with new furniture should be the last step in the remodel. Hopefully you’ll have taken into account the advice to create a flexible workspace when choosing walls and floors, so you’ll want to select furniture that is flexible as well. There are lots of choices in both modular office furniture and adaptable workstations that can help keep you from having to purchase new items every time your needs change.
By carefully planning your remodel with an eye toward increased efficiency as well as future organizational change, you should be able to recoup some of the cost of the remodel and wind up with an office that allows your firm to adapt to whatever changes lie ahead.
Let’s Do Some Firing
Do you have an employee that just does not contribute? Do you ever wonder what the heck is this person doing here? Do you get negative feedback from employees or customers? You muse, ‘they have only been there a few months’ so we should give ‘em a shot. Or you think you can’t get rid of them because ‘they’ve been here forever’!?
Well, it’s time. Go on. Don’t wait to fire any longer. Just. Do. It.
But…but…wait you say? You have a small team and you worry about the impact on morale? Well, the negative impact on morale builds everyday this under performer is still at the company. Imagine how hard it is to give it your all, when you the person you sit next to someone that sucks. There is very little that is more demotivating. Disruptive, negative, or under-performing employees set you back way more than just their direct lack of performance. Poor performers are infectious! In the way they handle projects, talk about clients and the direction of the company, they can contaminate your momentum. Poor performers will stick around as long as they can. On the other hand, excellent performers will only stick around so long when they see you value them and don’t tolerate and foster less.
Falling behind in projects, damaging vendor relationships, and losing information are often fears much more than they are actual issues. You might be surprised to find no gaps, or an improvement, after an under-performer departs.
But…but…but you worry about the legal repercussions – “California law makes it so hard… “ or “We don’t have the right documentation in place.” Blah blah. As an HR person I know I’m not supposed to say that, but you are trying to run a business! And this is killing you. If you are a fair and non-discriminatory employer, acting according to the true business needs of your organization, you shouldn’t have anything to worry about*.
*A quick disclaimer: I am not a lawyer. I will not take responsibility for your employment decisions and I know every time you have to call a lawyer its prohibitively expensive. And yes, sometimes it is complicated. Everything you do as an employer involves some risk.
Let’s turn to Exhibit A: Jack Welch made a career out of firing the lowest performing 10% annually. This was a formal system at GE, forcing a differentiation between the 20% of top performers, the 70% of adequate or average performers, and the 10% of under performers. The top tier was rewarded disproportionately. They were given money and generally lavished. The bottom 10% in Welch’s system had to go – no ‘if’s’, ‘ands’ or ‘buts.’ It was controversial, but it forced managers to make hard decisions, that they most likely would have never gotten around to otherwise. It set the tone of performance, expectations, and values. Some credit this system with a 28-fold increase in earnings and a 5 times revenue at General Electric in the 20 years of Jack Welch’s tenure.
Every company has its own culture. Most companies would say part of their culture includes a team of exceptional performers and investing in their team. Unfortunately, most companies, for all kinds of reasons, also allow under-performers, bad-apples, and legacy function to exist for way too long. This is a trait you need to break. Not only are relaying on folks that only do a sub-par job for you, but more importantly it’s a culture that demotivates your top performers.
Rip off that band-aid! You might find it the best thing you ever did.
Are You Measuring Employee Turnover?
Like everything, if you don’t measure turnover, you can’t manage it and you can’t learn from it.
Turnover can be as important and actionable a metric as net cash flow or growth. Your team is your business. There is also a significant direct financial impact with turnover. Most estimates, put replacing an employee at about 150% of the employee’s salary. Seriously! Think of paying vacation time out, placing ads, extra admin costs, losing time and productivity to interview and get the new hire up to speed. There is also an increase in unemployment premiums, a risk of lawsuits, and morale issues. Double Whammy time: half of departing employees also take other employees with them. They often go to your competitors. For managerial and sales positions, the replacement figure is 200% ~ 250%. Turnover effects profitability and is super disruptive.
Calculating your turnover is easy. The Department of Labor (DOL) suggests the following formula to determine the employee turnover rate: divide the number of separations during the month by the total number of employees at mid-month. Multiply this number by 100.
Let’s say you have 42 employees, and 2 leave in October, your month turnover rate is 4.8% – (2/42)*100. You can adjust this to figure out month, yearly, voluntary, etc… Work it!
In the U.S., for the period of December 2000 to November 2008, the average monthly turnover rate was 3.3%.[1] Keep in mind, different industries, periods in time, and calculation methods can change the rate significantly. Understand clearly how comparative rates are calculated, or just measure against yourself.
So, there is an impact financially and in productivity. I can measure it. What is there to manage and learn? To start with, are you making your hiring selections correctly? Or does a high percentage of staff leave after a few months? Can you predict the average tenure for employees? Perhaps you can see patterns in your turnover and work proactively to prevent the turnover of your best employees.
Over time, you will be able to adjust engagement and recognition programs, feedback and communication practices, hiring sources, pay and benefits, flexible work arrangements, or other procedures, and see if they impact your turnover.
What does your voluntary and involuntary rates tell you? If there is evidence you are firing absolutely no one, that could be a problem – under performing employees are extremely costly! How about turnover rate by manager? Remember, people leave their manager, not the company. Are you losing your best employees because a manager needs some training, mentoring, or to be fired? Are their certain times of the year, or in your product life cycle, that send your rate out of whack? While it’s pretty rare, a very low turnover might mean you are overpaying employees. What is your competitors turnover like?
Put your turnover rates alongside company profit, customer satisfaction, or other metrics. I dream of day where we can positively impact revenue simply by adjusting flexible work schedules. You get it. Have fun. Realize human resources, and turnover, matters and is another tool in your toolbox!
Hiring Remote Workers
For a long time I felt strongly about the importance of working on-site. I was sure information is shared casually between employees and that relationships are built that are crucial to efficiency, productivity and success. While I still see these as key issues, I’ve come around to see they can be accomplished for some employees, remotely, and if used productively can produce a bevy of other benefits.
The primary benefit for you, the owner of the company, is that a “Telecommuting Policy” can be a key business strategy to help you attract top talent, retain staff, increase productivity and save money.
You will instantly and vastly increase your candidate pool. Based on the latest Telework Research Network data, only about 2% of the US workforce considers home their primary place of employment. That isn’t a big number, especially considering the number of jobs that can be done remotely. World at Work and Robert Half studies show about 40% (or 50 million) of people who don’t telecommute say they have jobs they thought they could perform from home. Over the next five years this number will grow. Recruiting is in the numbers and the numbers are in telecommuting – you’re much more likely to find your complete dream team by being open to remote working options.
Telecommuting itself might increase productivity. 86% of telecommuters say they are more productive in their home office than at work. Over 75% said they were willing to work more hours – mostly because they save time and money by not commuting. Many excellent employees already have had some experience working remotely. Past employers knew their skills and were happy to trade off location to keep them on-board. Often, these employees are accustomed to making it work well, to building relationships, and delivering results. They anticipate typical roadblocks and use remote tools (Skype, Instant message, conference calls) and often introduce improved project management and group communication tools (i.e. IRC group chat, Yammer, Campfire).
Telecommuting could likely help you retain your top performers. Telecommuters report they eat healthier, are less stressed and have a drastically improved work/life balance. More than 75% say they are more loyal. Thankful for the flexibility and do prove their value, remote workers strive harder to deliver high performance. Beyond performance, the telecommuting trend needs to be embraced just to attract and retain staff. 72% of employees say flexible work arrangements would cause them to choose one job over another, and almost 40% specifically mention telecommuting. Gen Y’ers are notably difficult to recruit and retain and are particularly attracted to flexible work arrangements.
Many companies have concerns that telecommuting arrangements will lead to higher costs – but that need not be the case. A vast majority of employees are willing to take on the expenses of getting their own office furniture, equipment and supplies. This doesn’t include the savings you have with less folks on the premises (less office space, fewer phone lines and phones, facility costs, etc….).
Even with increased travel expenses to have remote employees on-site for project kick-offs or regularly scheduled meetings you might save money in the final analysis.
From a salary perspective, recently, a Dice.com survey found 35% of IT workers would take a 10% pay cut to telecommute. For a lower amount, 75% of respondents in a Staples study would take a pay-cut.
Telecommuting is a corporate strategy that will separate the winners from the losers when it comes to employee attraction and RETENTION. It’s a trend that is not going away; it’s only getting more convenient and productive for all parties.
Do you and your team have the skills needed to manage and leverage this type of worker? Can you envision a current or open position that you are looking for that could be done remotely? If you’re already telecommuting with some employees, is the program expandable to others you might have overlooked?
Don’t be late to the party!
Listen
I was talking to a sales executive about his method for narrowing in on what customers want. What new market is worth pursuing? How do you determine new stellar product features? We talked about dissecting the industry, examining competition, researching market demographics and the like, but he quickly pointed out how he really does it. He listens.
He listens to those who want to use the product, to customers and to those who have sold similar products before. We know good sales people are good at listening. Why aren’t we all?
Listening is hard. Most of us don’t do it well. In their book, Excellence in Business Communication, Thill and Bovee write, “Listening is a far more complex process than most people think. .. . most of us listen at or below a 25 percent efficiency rate, remember only about half of what’s said during a 10-minute conversation, and forget half of that within 48 hours.”
We can do better.
You might get new information about your product, customers, process, work environment, relationships, upcoming changes, etc… An even more important byproduct is, as an employer or manager, listening creates an environment of respect and trust. Employees who feel listened to and respected are more engaged and more productive.
Be a better listener. To be a better listener, remind yourself throughout the day that listening is an active skill. It is not something you just sit and do, passively. Concentrate. “Am I listening to this person?” “What would be like if I was the one saying these things?” “How would I feel and why?” “Do I really understand what they are saying?”.
In conversation, when someone is talking we are thinking of what we will say next. Very quickly, we stop taking in information and start forming a response. We think of a similar story to relay (to show we are listening) or we are reminded of a similar topic. “Oh, this is a good time to ask them about the XYZ project,” you might think. Meanwhile, we miss what is being communicated. This is a natural way we have learned to communicate. It takes practice to be able to undo this when its time to actively listen.
Be present with an open mind. We have a lot of information around us and unconsciously block details and assume links in order for the world to make more sense. This inhibits our listening. Be aware of the tendency to project your own experiences on others. Don’t assume you know the opinion of others. Don’t judge someone by the way they look, or the position they hold. I’m shocked by the number of times I think I know someone and think I know what they will say – when I’m quiet and actively listening I’m often surprised.
Paraphrase what you heard. This helps others feel heard and ensures you have all the important information and understand it accurately. When you can, recognize the feelings of the speaker, such as commenting on the thought that went into talking to you or the anger they feel. Ask open ended questions to get at the core issues and to create a venue for the speaker. Demonstrate your active listening with your body language – don’t glance at your phone! Eventually, you might even start to schedule extra time in your day to listen.
Listening equips you to make a better decision, helps better see intents and motivations and builds respect and trust. How do you actively listen and how has it improved your business?
