Relationship Woes?

Good relationships aren't difficult -- bad relationships are! In a business environment, poor relationships are also expensive. An Adecco Staffing survey of 1,000 workers reports that 49 percent of employees say yes, their relationship with their boss directly affects their productivity.

Yeah, it's that important.

Many managers don't really understand what motivates and matters to their employees. We sometimes assume, or think we know, but we don't. Let's look at another study, this time ranking the factors that most influence employee performance. In this study, not only were employees polled, but managers were also asked to predict what those employees' rankings would be. Were the managers right? Take a look.

What Managers Expected Employees to Say

1. High wages
2. Job security
3. Promotion within the company
4. Good working conditions
5. Interesting work

What Employees Really Say Influences Them

1. Full appreciation of work done
2. Feeling of being in on things
3. Help on personal problems
4. Job security
5. High wages

Feeling appreciated and clued-in ranks higher than wages largely because to be appreciated and well-informed prepares us to make outstanding contributions, meet critical goals, and make smart decisions that will result in career growth.

Think of the stereotypical editorial assistant, fetching coffee and doing front-line work -- the pay's not high, the prestige isn't high, and he hasn't chosen that environment to learn different blends of coffee beans. He's learning the business, making a contribution to the big picture, and working toward a fulfilling career.

Make time for important conversations...

Do you have to know the names of your direct reports' pets? Of course not, but knowing your employees' life and career goals helps you leverage what you and your employees have to offer one another into a healthy, productive relationship. A global consumer response survey of 1,625 workers gave some insight into welcome conversation. What aspect is most important when employers communicate with workers?

• Giving insights on how to be more effective (52 percent)
• Showing how to fit into the company's vision (47 percent)
• Explaining the company's vision (45 percent)
• Engaging on a personal level (41 percent)

Build those relationships. To your direct reports, you are the company. The company's strategic goals and how it all fits together comes from you. If you can't sum up those strategic goals, go to your boss, who may go to her boss... It's a conversation that may have unexpected benefits!

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The Chicken or the Egg?

In recent years, many studies have shown that high performing companies have employees with high employee morale, but which came first? Do the employees have high morale because their companies are doing well, or is the company performing well because the employees have high morale?

Morale by a Nose!

In The Enthusiastic Employee (Wharton School of Publishing), we see that high morale does indeed have a causative effect. The stock of companies which showed high morale in 2004 outperformed those in the same industries in 2005, as compared with more than 5,500 other companies in the same industries. Those stock market results are largely driven by earnings statements, creating a visible cause-effect relationship between morale and profit.

How is your company morale? Do you know?

Let your workers do the talking...

Marketers are increasingly investing in non-traditional marketing methods such as viral marketing, targeting trendsetters in conversational marketing. You may have the world's best marketing force already in your employ. Don't underestimate the power of employees who love their jobs, and their companies. Tap into the "viral marketing" you already have at your fingertips, and make sure it's working for you.

Barr Corporate Success is a results-oriented consulting firm helping business leverage leadership, build teams, foster accountability, increase profits and sustain long-term growth. To enjoy the benefit of more than 20 years of management excellence, please e-mail Krissi Barr, krissi@barrcorporatesuccess.com.

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Retention, Retention, Retention!

We often hear the truism that the three most important factors in real estate are: location, location and location. A less well-appreciated truism is that one of the most important factors in profitability is one that bears repeating: retention, retention, retention. After all, how can you build intellectual capital, maintain an integrated, functioning workforce, and rapidly adapt to changing market forces if you're continually finding, selecting and training candidates? Capitalize on the investment you've made in the training of employees, and the value you receive from those employees' accumulated knowledge -- don't let the good ones go if you can possibly avoid it.

You will lose at least 6 months' salary -- and up to 18 months' salary, for knowledge worker positions -- to recruit, hire and train a new employee.

No company or manager can control all the forces that might cause employees to leave. Spouses relocate, taking your good people with them... a whole host of other reasons companies cannot control. And of course, if an employee simply cannot meet expectations, both you and that employee would be better served by their finding a new role, either with your company or elsewhere.

However, many, many valuable employees leave for reasons that we can, and should control if we know what's good for business.

Why Do They Leave? Managers might be surprised to find out why workers change jobs. What would your guess be? More money? Nope. Although 97 percent of workers think financial compensation is one of the most important aspects in the workplace, it is not the main reason they change jobs. A Spherion study asked 1,996 randomly selected employed workers what the most important reasons were to change jobs. They answered:

• Growth and earnings potential (30 percent)
• Time and flexibility (23 percent)
• Financial compensation (22 percent)
• Culture, work environment (22 percent)
• Benefits (12 percent)

More cited growth potential than any other single consideration. Just as many listed work culture and environment as important reasons to make a job change as listed financial compensation. Flexibility on time and location is of great importance to those aspiring to excel both professionally and in their family lives. Employers are now facing the challenge of generations interested in self-actualization in both their work and personal lives.

Some managers might be tempted to throw up their hands and roll their eyes, wondering, "Just how far am I supposed to go to keep people happy?" That frustration is understandable, given today's "do more with less" culture.

The good news is that it is well within your power to increase retention -- and the performance of employees who stay -- with some fairly simple interpersonal skills.

• Pay attention to the career arcs of your direct reports, because they do.
• Be flexible when you can be, any way you can be, so employees can have careers and lives.
• Check out salary trends for your industry, so you don't lose $20,000 trying to save $3,000.

Paying attention can really pay off.

Barr Corporate Success is a consultancy firm dedicated to producing amazing results for businesses from Mom & Pop shops to Fortune 500 corporations. If your business is experiencing retention difficulties, it's likely a sign that a change is needed. Barr Corporate Success can show you the way.

For more information, please e-mail Krissi Barr at:

krissi@barrcorporatesuccess.com

or see our website at www.barrcorporatesuccess.com

Appreciate...Communicate... Accelerate!

You know your business better than anyone, so here are some useful questions you might want to consider. Would it surprise you to learn that "high wages" ranks halfway down employees' list of factors that most influence their performance? For some it's counterintuitive, but "Show me the money" is only a small part of the equation.

Managers predicted employees would rank wages highest, but the most important factor listed by employees as influencing their productivity was "Full appreciation of work done."

Stop and think about that for a moment. What is appreciation? Sure, a raise is a good indication that you value an employee's work, but does it communicate "full appreciation"? What about the second most important factor, "a feeling of being in on things?"

• Does everyone on your team feel that they know what's going on, when, and why?
• Can employees make a clear connection between their work and the company's vision?
• Have they had the company's vision explained to them in real-world terms?

A second study asked, "What aspect is important when your employer communicates with you?" The top answers:

Giving insights on how to be more effective (52%)

Showing how to fit into the company's vision (47%)

Explaining the company's vision (45%)

Engaging on a personal level (41%)

When you drag out the company checkbook, or better yet, before, share the company vision with employees, offer them concrete examples and guiding principles for decision-making and improvement in their performance, demonstrate sincere appreciation for the work they do, and show you care how work fits into their lives as a whole.

It's relatively easy to do on an individual basis, but increasingly hard to build into an entire company's culture.

Barr Corporate Success has improved teamwork, profits, retention, productivity and profits throughout organizations from family businesses all the way up to Fortune 500 companies.

Call Krissi or Jodi today to find out how we can help you hardwire amazing performance into your company!

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Lehner: "Skate to where the puck is going"

Eddie Lehner, executive VP and CFO of SeverCorr, showed nearly 200 area executives just what it takes to get a brand new steel company off the ground -- smart planning, supportive communities, and, most important, persistence. Lehner spoke March 14 to a joint luncheon for the Association for Corporate Growth and Greater Cincinnati Venture Association. A friend and former client of Barr Corporate Success, Lehner spoke compellingly of how he and other steel executives planned and financed the $900M start-up steel mini-mill in rural Mississippi from scratch.

"You're building what?" Lehner was asked

when he initially pitched the project. Some dismissed it as crazy. The steel industry is consolidating and fighting for market share with overseas competitors, but Lehner felt SeverCorr was at "the intersection of opportunity and chance." He anticipated the deal would take 3 months to put together. It took 21 months.

"It's humbling, and perseverance is 99 percent of everything. You have to put in the time, pay the price, keep going 'til you get to 'yes,'" Lehner said.

Why steel, why now, and why in the U.S.?

"Consolidation of the industry has left room for entrepreneurs to slip in underneath," Lehner said.

These entrepreneurs began their "crazy" mission with extensive combined knowledge and a sincere commitment to revitalizing steel in the U.S. They identified obstacles working against existing steel companies, and the largest was transportation costs. The answer: location, location, location.

"Transportation logistics is at a crossroads," Lehner said,

citing the saturation of insterstate highways. If SeverCorr could avoid long haul trucking, using water, rail, and short-haul trucks, savings would be substantial. The team knew any new steel venture would need to be located near the growing automotive manufacturing market in the Southeast. Auto plants for Kia, GM, Nissan, Honda, Mercedes-Benz, and Hyundai are clustering around the Mississippi River in Alabama, Louisiana, Tennessee, and Arkansas, seeking deep water for access from Brazil and Venezuela. Lehner followed the example of Wayne Gretsky.

"I skate to where the puck is going, not where it is."

Efficiency throughout the supply chain is key. SeverCorr benefits from new technology and equipment, with no legacy and maintenance costs from older equipment. The team developed trust with its suppliers; they negotiated consignment deals for raw materials which compact the cash conversion cycle so that the company need not pay for the pig iron until it hits the smelter. SeverCorr is the first domestic steel mill able to roll 72-inch hood stampings for automobiles, capitalizing on a local market not being met. Other factors smoothed the way for SeverCorr. Lehner cited Mississippi Governor Hayley Barbour as "a motivated governor" committed to economic development and willing to offer incentives. The Tennessee Valley Authority was able and willing to provide the vast power required for the mill. SeverCorr took full advantage of Mega-Site certification -- a McCallum Sweeney program that acquires tracts, performs Phase I and Phase II due diligence, and has the sites ready for development. The company bought a 1400 acre "golden triangle" bounded by the airport, river, and rail, breaking ground in October, 2005.

The community welcomed the plant, and more than 9,000 applied for the 400 initial jobs. Recent announcement of a Toyota plant to be built 70 miles from SeverCorr is yet another boon.

SeverCorr's talent management is also an update to traditional models. Lehner said the company has a covenant with its workforce, an egalitarian philosophy stressing

"commitment, knowing what we're doing, and why we're there. "

With construction expected to finish this October, SeverCorr is positioned to revitalize the domestic steel industry, and spark development throughout communities in the rural south. The day it opens, the mill will be the largest solid waste recycler in the state of Mississippi. Despite years of effort, months spent in hotels, and more than 900 pitches to financiers, Lehner speaks enthusiastically of the journey.

"It's not often you get to advance your field like that," Lehner said.

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Strengths Can Become Weaknesses

Investor and financier extraodinaire Warren Buffet has said that most people could be as successful as he if they got out of their own way. While leaders have coping styles which enable them to get beyond daily crises, some of those coping styles can trip them up in the long run. Are you defeating yourself with one of the following tactics?

• Avoiding confrontation. Sometimes the stronger you are, the more you avoid confrontation. "I don't want to upset people," you say, but it may be that you fear losing control.
• Hiring great advisers, but not listening. It's difficult to change habits, which have been reinforced over time, but ignoring your most insightful colleagues isn't the answer.
• Not acknowledging when you're wrong. It's somewhat horrifying, initially to think, "If I'm wrong about this, I may be wrong about other things." It takes great strength to admit being wrong, but builds a strong team mentality and eliminates the protectionism that perpetuates mistakes.
• Not dealing with reality. Same situation -- if you can't handle one reality, others are sneaking up on you. Confront and deal with reality.
• Waiting too long to cut your losses. Your stick-to-it-iveness has served you well in many situations, but throwing good time, money and effort after bad won't always bring about turnaround.
• Dwelling on strategies without following through. While it's lovely to behold your strategy from afar, execution is key. Strategy is a process -- not ironclad marching orders -- that helps you move forward purposefully. Yes, you will find flaws, but can adapt and move on to success.
• Relying on analysis over instinct. Logic and reality don't always synch. The market moves fast, and over-reliance on analysis sometimes takes more time than you have.
• Trusting instinct over analysis. Yes, this contradicts the previous pitfall -- but either extreme can be disastrous. Let's face it: Desires and wishful thinking can distort your "gut feeling." Ground yourself in reality, without getting buried in analysis.
• Playing favorites. Rewarding "brown-nosers" might gratify your ego, and temporarily make your life easier, but will poison team dynamics and cost you talent and turnover.
• Mocking what you don't understand. Nobody knows everything, and taking the position of interested learner increases your knowledge and understanding. Dismissing new info as unimportant can mean missing huge opportunities.

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Lehner of SeverCorr to Speak March 14

I’d like to personally invite you to join me and the Greater Cincinnati Association for Corporate Growth and the Greater Cincinnati Venture Association as we host Eddie Lehner, CFO, SeverCorr on Wednesday, March 14. Eddie is both a personal friend and former customer. The deal at the heart of his topic, Raising $900M To Build A Steel Company in Rural Mississippi, was named the 2005 “Deal of the Year” by Project Finance Magazine. The topic comes at a time when U.S. manufacturing industries and the surrounding issues of outsourcing and jobs are on the minds of the American public, corporate management, and elected representatives.

SeverCorr will use low-cost technology to produce high-quality steel, a market largely served by U.S. Steel, Mittal Steel and AK Steel, which employ more expensive techniques. If successful, SeverCorr could prompt a whole new wave of steel industry investment in the United States. SeverCorr believes it has other advantages over its northern rivals: It's non-union and strategically located near several automotive manufacturing facilities. SeverCorr has been recognized for the unique way in which the financing was structured. The majority of the vendor payments are linked to the long-term performance of SeverCorr. GE Commercial Finance has backed the plant with over $440 million. Eddie has local roots – earning his degree from UC and starting his career in Cincinnati’s Deloitte & Touche office. I’m excited about the opportunity to hear Eddie speak and hope you can join me Wednesday, March 14 at the Hilton Cincinnati Netherland Plaza’s Hall of Mirrors! Registration is at 11:30, followed by the luncheon and presentation from 12 to 1:30 p.m.

You can easily register by calling 866-500-ACGC or visiting www.acgcincinnati.org for secure online registration. Please feel welcome to invite anyone who you think would enjoy hearing Eddie’s insights.

See you there!

Krissi Barr

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