lip$service:$are$your$employees$really$ as ......quesson$#3 if$yes,$you$are$likely$ge{ng$...

LIP SERVICE: Are Your Employees Really As Important As Your Customers?

Dick Finnegan June 24th, 2014

WELCOME To Orlando, My Hometown!

Copyright C-Suite Analytics, 2014 All Rights Reserved

Finnegan Background

“Recovering HR director” solved turnover for Siberian banks, African gold mines, Chinese mulS-‐naSonal corporaSons…and the CIA

Author, Rethinking Reten*on in Good Times and Bad, endorsed by BusinessWeek as offers “fresh thinking for solving the turnover problem in any economy”

Author, The Power of Stay Interviews for Engagement & Reten*on, top-‐selling SHRM-‐published book 2012 & 2013 Noted expert by BusinessWeek, Chief Execu*ve Magazine, & Consul*ng Magazine

www.c-‐suiteanaly/cs.com 2

3 www.c-suiteanalytics.com

“Please Your Employees and You Please Your

Customers” …My high-‐vision, first CEO

Today’s AMBITIOUS Agenda

6 Chunks 1. Report Dollars for E & R 2. How to Report Survey scores 3. Survey frequency 4. Power of Stay Interviews 5. ForecasSng 6. New exit interview idea

What makes us happy? Free how-‐to-‐do-‐this tools

4 www.c-‐suiteanaly/cs.com 4

Bad News or Good News? The Economist Intelligence Unit survey of C-‐Suite ExecuSves: What is most likely to harm your organizaSon financially over

the next 12 months? 53% say insufficient talent n  What are the obstacles to HR taking a greater role in strategic

planning? 41% say Is too focused on processes and rules – not a “big picture” person

n  HR survey: Which top priority do you solve least effecSvely?

Engagement & Reten*on

5 www.c-‐suiteanaly/cs.com


1. How ogen do you survey?

2. For major issues, how many days for your company to implement changes?

3. When major issues, how many days Sll you re-‐survey? 4. Do real consequences happen for managers that directly impact raSngs, pay, promoSon opportuniSes?

5. How many managers have you terminated in the past year due to survey results?

Customer vs

Employee Surveys

Employees As Important As Customers?

Sales vs Engagement/RetenSon

CEO AcSon

Sales Engagement RetenSon

Sets monthly & annual goals?

Yes ”Beat last Sme” or “beat benchmark”; few set goals

SomeSmes

Report goals, progress to Board?

Yes Rarely Rarely

Hold managers accountable in

meaningful ways?

Usually Hardly ever Rarely


By words AND acSons, who does your CEO think is more important?

q  Customers? q  Employees? q  Both the same?


Poll QuesSon # 1


Line of Sight

Revenue$ – Expense$ = Profit$


Line of Sight

Revenue$ – Expense$ = Profit$ Engagement Scores + Turnover %s = ?

Do you report either your survey scores or turnover percentages with dollar costs?

q  YES? q  NO?


Poll QuesSon #2


0 5 10 15 20 25

2009 2010 2011 2012 2013

U.S. Voluntary Quit Percentages, Post-‐Recession…U.S. Bureau of Labor Sta*s*cs

Chunk #1: Report Dollars/Turnover

Actual client turnover costs by job: ü  Physician…$225,808 ü  Sogware engineer….$131,000 ü  Call center representaSve…$29,447 ü  Truck loader/unloader…$4,955


Cost Per Hire + LOST PRODUCTIVITY, Not __% of Annual Pay


$ Turnover = Cost to Replace + Lost ProducSvity

Lost ProducSvity = Employee’s Daily $ ContribuSon X Days Job Open + Ramp-‐Up Days

Placing $ Values on Turnover

Hospital Example/12 Months Costs, 5 Job Bands

Job Group Example Jobs Cost/exit Cost/12 months

Non-skilled EVS, food svs, admit rep $8,503 $255,090

Skilled Hourly patient care tech, phleb., sec 12,627 568,215

Licensed Hourly rehab ther., radio. tech, resp. therapists

20,388 428,128

Nurses inpat. nurses, emerg. nurses, surg. nurses

46,250 2,350,000

Exempt mgrs, directors, case mgrs 57,857 694,284

TOTAL $4,295,717


Dollars Drive RetenSon Accountability

Manager RetenSon Goals

Results Cost of Turnover

Merbach All T/O 15% 13% $105,378

1st Yr T/O 5% 3% 31,254

Finnegan All T/O 15% 10% $71,598

1st Yr T/O 5% 5% 49,560

Murphy All T/O 15% 22% $221,369

1st Yr T/O 5% 11% 88,321


Chunk #1: Report Dollars/Engagement

Either… A.   Distribute correlaSve studies B.   Conduct correlaSve studies with your company’s

data C.   Apply C-‐Suite AnalyScs’ engagement cost

calculator


How Much More Do Engaged Employees Produce?

q  Gallup: 22% more profitability/lower turnover (TO)/higher earnings per share (EPS)

q  GPTW InsStute: 20% more producSvity/lower TO/higher EPS

q  Hewix: % engaged correlates with higher shareholder returns (S/H)

q  Kenexa: double S/H returns q  WorkUSA/Watson Wyax: 26%

more revenue per employee


Introducing

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The very best…and only… Engagement calculator

I know

www.c-suiteanalytics.com

The Research Source

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“Watson WyaO analyses show that a significant improvement (one standard devia*on) in employee engagement is associated with a 1.9 percent increase in revenue per employee.“

“Debunking the Myths of Employee Engagement”, Watson Wyax…now Towers Watson…..2007


Engagement Calculator Example


Ø OrganizaSon earns $100 MM in annual revenue

Ø  Conducted engagement survey that reported scores on a scale of 1-‐10

Ø  Targeted score was 8

Ø  Actual organizaSon score was 7

Ø  DistribuSon of scores indicates 1 SD = 1

Engagement Calculator Example

23

1 10 8

Target Score

Actual Score

7

SD = 1

6

If organizaSon score is 1 SD below target score…

OrganizaSon is losing 1.9% of revenue… .019 x $100 MM = $1.9 MM


Engagement Calculator Example Technology Department

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Ø  OrganizaSon earns $100 MM in annual revenue

Ø  Conducted engagement survey that reported Ø  scores on a scale of 1-‐10

Ø  Targeted score was 8, actual technology Ø  department score was 9

Ø  DistribuSon of scores indicates 1 SD = 1

Ø  Technology department salaries & benefits = 10% of organizaSon’s total salaries & benefits


Technology Department Example

25

1 10 8

Target Score

Technology Dept. Score

7

SD = 1

6

If technology dept. score is 1 SD above target score…

Technology dept is achieving 1.9% of addiSonal revenue… .019 x $100 MM = $1.9 MM x .10 = $190,000…when technology department salaries & benefits comprise 10% of organizaSon’s total salaries & benefits

9


This Engagement Calculator Works!


“The C-‐Suite Analy*cs Engagement Calculator is a welcomed, one-‐of-‐a kind tool to help organiza*ons fully grasp the value of engaged employees…as well as the huge number of dollars leX on the table when employees don’t give their best. Perhaps its greatest value is that it dis*nguishes managers who influence engagement from those who do not, in specific dollar values. This calculator is based on broad-‐based research and its algorithms have a solid sta*s*cal founda*on. It can work with any engagement survey and assumes that survey measures engagement in a valid way.” Dr. Gary Borich, Ph.D Endowed Fellow, QuanStaSve Methods Program The University of Texas at AusSn

Chunk #1: Report Dollars/Engagement

Either… A.   Distribute correlaSve studies B.   Conduct correlaSve studies with your company’s

data C.   Apply C-‐Suite AnalyScs’ engagement cost

calculator


Chunk #2: Survey Scores Gallup/Bersin

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U.S. Companies on Track to Spend $1.53 Billion Each Year to Improve Engagement… on Surveys & Programs

www.c-‐suiteanaly/cs.com

Only Top Box Counts! Engaged employees work with passion and feel a profound connecSon to their company. They drive innovaSon and move the organizaSon forward

Not engaged employees are essenSally checked out. They're sleepwalking through their workday pu{ng Sme — but not energy or passion — into their work AcSvely disengaged employees aren't just unhappy at work; they're busy acSng out their unhappiness. Every day, these workers undermine what their engaged coworkers accomplish 29 www.c-suiteanalytics.com

Does your survey company give you an “engaged” score of 50 or above?

q  YES? q  NO?


Poll QuesSon #3

Does your survey company give you an “engaged” score of 50 or above?

q  YES? q  NO?


Poll QuesSon #3

If YES, you are likely ge{ng high and middle scores combined and only high scores drive producSvity


Benchmark means standard, average, mediocre…so which statement drives more acSon?

CEO, our turnover is 19% and the benchmark is 20%

CEO, our turnover is 19% and it’s cosSng us $7.9 MM each year

OR

Chunk #3: Survey Frequency


Problem: Would you wait a year to re-‐survey your dissaSsfied customers or paSents?

SoluSon: Track each managers’ improvements by quarter vs by year

Because managers drive your producSvity and revenue metrics!

How ogen do you survey your employees?

q  Once per year q  Less frequently q  More frequently

q  We don’t survey


Poll QuesSon #4

Are Your RetenSon Efforts Driven By AccountabiliSes or Programs?

Business AccountabiliSes driven by execuSves from the top like sales, service, quality, & safety



RetenSon Programs driven from the side like town hall meeSngs, employee appreciaSon week, newslexers




RetenSon Programs driven from the side like town hall meeSngs, employee appreciaSon week, newslexers



86% of the Sme

How does your company survey solve engagement & retenSon?

q  Employee programs? q  Manager accountabiliSes?


Poll QuesSon #5

Supervisors’ Impact on Engagement & RetenSon

“If you have a turnover problem, look first to your managers”…Gallup

Employees stay for managers first and co-‐workers second…salary.com Employees’ levels of engagement higher when their supervisors had higher levels of engagement…DDI

“When employees stay, it is because of their immediate managers”… NaSonal EducaSon AssociaSon

Employees who stay primarily for their supervisors stay longer, perform bexer, and are more saSsfied with their pay…TalentKeepers


The Real Power of Supervision

Kenexa interviewed 1,000 recently-‐quit employees and asked about pay, benefits, development, advancement and relaSonships with supervisors…and found supervisor rela*onships influenced all other opinions, concluding… “Offering a higher salary or developmental/advancement opportunity may not be enough to retain employees”


Do Clinical Directors Really Drive RetenSon?

RecommendaSon: Hold clinical directors accountable for achieving retenSon goals


Compared one hospital that held nurse managers accountable for reten*on versus others that implemented various programs & found ‘Accountable hospital nurse turnover down 41% vs. others stayed the same.’

-‐ Hardwiring Right Reten*on, the Advisory Board Company’s Health Care Advisory Board

One Big Lesson Learned

It’s not what you give them…it’s how you treat them


Insanity: Doing the same thing over and over again and expecSng different results

Survey 25% sample quarterly & remove supervisors who do

not improve

Chunk #4: Leaders Conduct Stay Interviews


Structured discussion a leader conducts with each individual employee to learn the specific acSons she must take to strengthen that employee’s engagement and retenSon with the organizaSon…

Bring informaSon that can be used today

Focus on individual employees including top performers

Put managers in the soluSon seat

Stay Interview Key Ingredients


Cascade Tops Down

Conducted by supervisors vs. HR

Separate from Performance

Have managers forecast retenSon

Gather stay & leave reasons at the top

Once/year conSnuing employees and twice for new hires

Top-‐Selling SHRM-‐Published Book 2012 & 2013

44

3 Stay Interview Success Stories

Florida Hospital Zephyrhills…All turnover 37%; nurse turnover 70% Burcham Hills ReSrement Community…Nurse turnover

70%; 100% retenSon first 180 days Novo 1 Call Centers…Agent turnover 20%


Do your managers conduct stay interviews?

q  Yes?

q  No?


Poll QuesSon #6


Chunk #5: ForecasSng

Secret: ForecasSng is a sales SOLUTION because it drives salespeople to close sales So why not ask managers to forecast engagement & retenSon?

RetenSon Forecast “HeatMap”


Leader: Rodriguez

Perf RaSng/ 5 Hi, 1 Lo

Green 1+ yrs

Yellow 6-‐12

Months

Red 0-‐6 Months

RetenSon Plan

Kim Johnson

4 Provide mentor for…

Burt Brown

5 Develop skills for possible promoSon to…

Cindy Stone

3 Pleased with current role & circumstance

Ralph Jimenez

2 Coaching for performance

48

Which Engagement ForecasSng QuesSon is Best?

1.   Will your survey results increase this Sme? 2.   What will be your survey score this Sme? 3.   Will this employee score in the top box?


Only Top Box Counts! Engaged employees work with passion and feel a profound connecSon to their company. They drive innovaSon and move the organizaSon forward Not engaged employees are essenSally checked out. They're sleepwalking through their workday pu{ng Sme — but not energy or passion — into their work AcSvely disengaged employees aren't just unhappy at work; they're busy acSng out their unhappiness. Every day, these workers undermine what their engaged coworkers accomplish 50 www.c-suiteanalytics.com

Which Engagement ForecasSng QuesSon is Best?

1.   Will your survey results increase this Sme? 2.   What will be your survey score this Sme? 3. Will this employee score in the top box?


Does your company conduct exit surveys in any form?

q  YES? q  NO?


Poll QuesSon #7

Please raise your hand if you have significantly improved your company by conducSng exit surveys


Poll QuesSon #8

Chunk #6: Managers Conduct Exit Interviews

Managers ask supervisors…

1.   Did you see this exit coming? 2.   What was your forecast for this employee? 3.   What holes were in your stay interview stay

plan? 4.   Who else on your team do you need to

address? 5.   What lessons have you learned?


54 54

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“Fresh-‐thinking for solving the turnover problem in any economy”…BusinessWeek

Accountability-‐Driven like Sales & Service to…

ü  Reduce Cost of Turnover ü  Improve Employee Engagement ü  Improve Revenue & Profitability

Dollars Goals Stay Interviews Forecasts Account-‐

ability



6 Chunks

56 56

1. Report Dollars 2. How to Report Survey scores 3. Survey frequency 4. Power of Stay Interviews 5. ForecasSng 6. New exit interview idea

Which has greatest impact for your organizaSon?

…Versus which is easiest to do?

Poll #9 Gallup’s 100-‐Year Commitment


Surveying ciSzens of the world to learn what brings most happiness over 100 years. So far the answer is…

a.   Good health? b.   A good job? c.   Love and respect from others?

d.   Money for needs and more?

e.   Bexer life for your children?

Gallup’s 100-‐Year Commitment


a.   Good health

b.  A good job c.   Love and respect from others

d.   Money for needs and more

e.   Bexer life for your children


To Obtain

ü How to Cost Turnover & Engagement

ü Engagement CorrelaSons to ProducSvity

ü The Stay Interview Manager Training Game

Please Leave Your Business Card

Include # of Employees

DFinnegan@C-‐SuiteAnalyScs.com

407.694.3390

lip$service:$are$your$employees$really$ as ......quesson$#3 if$yes,$you$are$likely$ge{ng$...

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