(Article) Tips to Get The Most Out Of Your Employees - Your Human Capital -- Linda Duffy

Tips to Get the Most Out of your Employees -- Your Human Capital
by Linda Duffy

 

1.     Think of your employees or human capital and make sure you’re getting your return on your asset or investment. Your employees may be assets that go home every night, and for most companies, payroll is the largest line item in their budget. Unlike most assets that depreciate over time, your human capital appreciates in value. Employees acquire new knowledge, skills, and abilities, and they have tribal or organizational knowledge that takes time to replace.

Make sure you’re measuring the ROI or ROA of your human capital. Choose appropriate metrics for your industry and organization and just start someplace. Choose simple metrics at first such as (a) revenue per employee or payroll dollar; (b) error rates; and (c) productivity per employee.

2.     Train your managers! The Gallup Organization has done extensive research regarding employee engagement. They found that the number one reason employees leave their employers is NOT compensation, but because of their boss! After surveying millions of employees worldwide, they also found that only 30% of employees are actively engaged at work, 50% of employees are not engaged, meaning they’re just kind of hanging out, and the other 20% are actively disengaged, meaning they’re toxic and spreading discontent.

Managers need to be equipped to manage employees, including how to identify top talent, develop talent, motivate employees, and provide effective feedback. Many managers are promoted because they were the best worker, not because they have management skills. When people are promoted into management roles and not provided training, 40% fail within the first 18 months. So, the most important decision you can make to improve your organization is to hire and develop great managers.

Focus your hiring on what the person must DO to be successful. About 50% of our business is recruiting, and we work in all industries and recruit employees in all types of positions. Whenever we start a search for a client, we ask one question over and over: what must this new person DO to be successful? Most people answer that question with a list of HAVES: college degree, # years of experience, etc.

We focus them on the actual deliverables for the position that will support the company’s overall strategic objectives. We then develop what we call a Success Profile, and listeners can download samples from the Resources page of ethoshcs.com. For example, we’re doing a search right now for a National Sales Manager for a manufacturing company. In order to be successful, the new manager must develop a strategic plan to support 40% revenue growth, broken down by industries and territories. In the first 60 days, the manager must drive the implementation of a CRM software tool. And so on… There are actually 11 deliverables for that position in the first year.

What’s great about this process is that everyone has absolute clarity about what is expected, so it dramatically increases the success rate in hiring. That Success Profile becomes the basis for how we source and recruit candidates; the candidates love it because either the job excites them or they simply self select out of the process; and hiring managers love it because they have a performance management tool once the new hire starts.

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