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Finding and Keeping Great Employees
Lawn & Landscape Magazine Webinar
April 7, 2015
Brad Johnson
Founder, LawnAmerica Inc.
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• Owner of LawnAmerica in Tulsa and four other branches.
• Our niche is weed-control/fertilization…not mowing or maintenance.
• Built and sold two other companies, with a total of 30 years in the industry.
• Have employed hundreds of folks, mostly good ones, learned many lessons, but still have not figured it all out!
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• What is the #1 problem for lawn
and landscape business owners?
• At conferences, in conversations,
wherever, what do business owners
complain about the most?
• What do we always hear that is “our
biggest asset”?
• What is the largest expense category on
your P&L?
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It’s People!
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Employee salaries and related expenses are by far the largest
expense on our P&L.
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16.3%
51.6%
3.3%
5.4%
5.1%
3.1%1.2%
14.0%
Year to Date Company Expenses
Cost of Sales
Direct Labor & Employee
Sales Expenses
Equipment Expense
Office & Occupancy
Overhead & Other
Contributions
Net Cash
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So where then should most of our focus be? Where is the largest area
for financial improvement?
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• We’re not going to discuss much on where and how to find good people.
• However, just as obtaining sales from referrals from happy customers, getting new employees from happy (or engaged) employees is the best way to do that.
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• Our focus today is on how we keep those good employees from year to year, with less turnover, and giving them a place where they want to come to work.
• It’s all about Employee Engagement.
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So why do we always seem to be needing new employees?
• Growth…that’s a good thing!
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$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
1 3 5 7 9 11 13 15 17
Series1
Series2
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People Leave!
• Employee retention in our industry is a problem.
• I would speculate that many companies do not even measure and track that number, and if they do, it runs around 55-70% annually overall on average.
• Over the past 5 years, we’ve averaged about 88% retention, with zero turnover in the past 8 months with 54 team members.
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So why do people leave?
• We are simply not providing them with an opportunity to engage their hearts, spirits, minds, and hands into their work in a passionate and committed way.
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Let’s Look at our Industry
• Are we really providing a career for our front-line employees, with an opportunity to make a good living financially and support a family?
• Are we providing growth opportunities?
• Are we guilty of too often just looking at our front line people as Direct Labor….a number on a P&L, and a number which we all need to keep as low as possible to make a good profit?
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• It’s really pretty simple….we have to give them such a great place to work at they want to stay, so that we’ll then have fewer new hires to make.
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So What is Employee Engagement, and Why does it Matter?
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There are MANY benefits to having fully engaged employees, one of which being that the chances of them staying on board go up greatly (87% less likely to leave.)
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Establish a Baseline First
• Conduct an Employee Engagement Survey.
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0%
20%
40%
60%
80%
100%
120%
1 3 5 7 9 111315171921232527293133353739414345474951
Team Member Engagement Levels March 2015 AVG 86%
Series1
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What about Pay and Perks?
• Compensation matters, and perks and benefits matter. However………
• These only satisfy basic needs, they don’t really get one engaged.
• But without having their basic needs met (money), then you won’t even have a chance to build engagement into them.
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• So are you paying as much as you can to your frontline employees, so they can actually make lawn care a career, or just paying the least you can to get by on?
• Are you providing a salary structure which provides performance incentives, rewarding individuals and teams for good performance and results?
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Route Manager Incentive Pay
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Category Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. Totals My Goal
5% Production $120 $740 $730 $1,310 $870 $890 $890 $850 $820 $1,320 $780 $430 $9,750
Production Over $195,000-5% bonus $50 $50
$20/Customer Net Gain $40 $140 $100 $0 $0 $0 $0 $20 $20 $100 $420
Respray Response $40 $40 $40 $30 $30 $30 $210
1st Application $30 $30 $30 $20 $20 $20 $20 $20 $190
Team Production Goals Met? $90 $90 $135 $90 $90 $90 $90 $90 $135 $900
Dec. 1st Cancellation Rate 15.8% $600 $600
Within 2% of goal $200 $200
NPS ___% $300 $300 $300 $900
Within 5% of Company Avg NPS $100 $100 $100 $300
Production on Total Sales-2.5% $5 $25 $35 $45 $55 $55 $55 $65 $125 $145 $90 $40 $740
Re-Spray/Production--3.5/2/1 $70 $70 $60 $60 $40 $40 $340
Avg OT $40 $170 $250 $330 $250 $180 $160 $100 $110 $240 $200 $40 $2,070
Avg Christmas Bonus $3,000 $3,000
TOTALS $565 $1,095 $1,275 $2,060 $1,395 $1,735 $1,305 $1,195 $1,255 $2,260 $1,170 $4,360 $19,670
Production Focus
Sales Focus
Customer Service/Quality Focus Some guys make $17K, others make $27K
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• So yes, solid, fair pay, while rewarding employees for good performance is important.
• Factors such as safety, benefits, reasonable working hours (especially Millennials), perks, etc. are all good also.
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So How do we do develop those fully engaged employees in Lawn Care?
• Well, it’s sure not easy and is a constant challenge!
• Front line work can be very hard, monotonous, and not real “sexy”.
• However front line work can also be a great job with many positive benefits (such as being a great way to stay in shape!)
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So a few things I’ve learned over the years that seem to help.
• For employees to be fully engaged, they must be provided a place where they can throw their hearts, spirits, minds, and hands totally into their work.
• They must understand the WHY of what they do, and have a clear mission that defines what success looks like.
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• Employees like autonomy and trust, and to feel like they have a say in their jobs and in the company.
• They must understand that it’s not all about them, but about serving others.
• Employees like to work in teams.
• Employees like to be managed fairly, and given good feedback on a consistent basis.
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• People don’t leave companies, they leave their owners, managers, and supervisors.
• Employees like to work for companies that have good, ethical, engaged ownership.
• Employees like to work for companies that give back to the community and do good things for others. They like to make a difference in their world with through their work.
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So What is our Main Responsibility?
• You gotta LOVE your employees!
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Route Managers, Techs, frontline CSR
Team Leaders, support, middle
managers
Me