Herb Kelleher, the founder of Southwest Airlines — the only major airline to net a profit in post-9/11 America — is quoted as saying, ''There is one key to profitability and stability during either a boom or a bust economy: employee morale.''
Sadly, according to a 2005 study compiled by David Sirota of Sirota Consulting, only 13.8% of companies surveyed have what can be called ''enthusiastic'' workforces. And according to another 2005 study performed by the Society for Human Resource Management, 85% of currently employed American citizens are either actively or passively looking for a new job.
This staggering statistic led me to seek out the advice of a CEO with a unique approach to employee management to find out if keeping employees happy truly does affect a company’s bottom line.
Valuing Your Employees: A CEO’s Guide to What Is Really Important in Business
Mimi Slater is the longtime CEO and president of Micro J Systems, the recognized leader in providing application software and information systems to the domestic and international staffing industry. Before joining the staffing community, Slater owned her own construction company. When the economy went south in the 1990s, she decided to make a career change and began working in the staffing industry.
Slater says, ''As I learned the ropes and began working with search firms, I realized that the key to staffing a company and retaining employees was to treat them right. So many companies miss the fact that the employees are the vital key to the success of the company, no matter what field they are in. The people I hire and work with make me look good. Any CEO should know that.''
Slater moved up the ranks quickly, first working as a trainer at Micro J before becoming the head of training and support. At the time Micro J was in the process of developing an enterprise application. The product became such a success that a new company was created and taken public, leaving Micro J floundering without anyone to run it or to support the smaller customers who were not big enough to use the new product.
Slater was asked to take over Micro J as its president and CEO. That was 11 years ago. Slater says she ''then decided to restructure the processes of Micro J to make it a better place to work, with a good solid product for our customers.''
What Makes Micro J a Success? How Mimi Slater Grew Her Company
Slater says that Micro J is a success because ''we have a great product.'' Their flagship products, PcHunter and Tempus Fugit, were the brainchildren of Jim Jonassen, who at the time was running a successful search firm, Larkin & Associates. His firm was looking for a way to automate and was unable to find a suitable product in the marketplace, so they set out to develop one for themselves.
''I already had the product and the customers; I just needed to clean house with regard to the internal systems within Micro J,'' Slater explains. ''The most important part of getting organized was to get rid of employees that were dragging the company down with poor quality of work and bad attitudes. This poor quality of work reflected in the product being neglected along with customer service failing.
''I had to make the employees see that having pride in their work would improve the product, and the amount of their paychecks and benefits would follow. This process took time, but the result was happier employees and more satisfied customers.''
It’s Not All about the Benjamins: Why a Happier Work Environment Makes for a Better, More Successful Employee
Contrary to popular belief, for employees it’s not all about the paycheck. According to Leigh Branham, author of The Seven Hidden Reasons Employees Leave, while 89% of managers think that employees quit their jobs for better-paying jobs, only 11% of employees truly leave for that reason. That leaves 88% of employees quitting their jobs for other reasons.
What are those other reasons? Feeling devalued and disrespected, being overworked and overstressed, and losing trust in one’s CEO, among others, are the main reasons employees quit their jobs. So how can a CEO make his or her employees stay?
One of Slater’s longtime employees, Bret Kinkele, says of his boss, ''When I started at Micro J nearly a decade ago, Mimi Slater had been the acting CEO for a little over a year. The board made her appointment permanent shortly after I started, and I soon realized why. A top priority of Mimi’s at that time was to build a staff of people that fit her focus: creating a software vendor with the best customer service in the industry.
''Due to the complexity of the software applications offered by Micro J, Mimi knew that she would have to retain the talent she had. At the time many job seekers were flooding to dot-com jobs, hoping to make it rich on stock options. Being a privately held company, Mimi could not attract talent this way, so instead she focused on offering them the best working conditions she could. She put a retirement plan in place, offered excellent benefits, and even paid for employee parking. She also invested time and money in providing the best working conditions possible.
''Her number-one responsibility was treating her employees well. Micro J employees never had to contend with dingy cubicles or outdated equipment. We had large offices with windows and the very best equipment money could buy. She never once hesitated to buy the tools we needed to get our work done.
''She also chose to embrace the small business mantra of ‘We are a team, and we all need to wear many different hats to succeed.’ She included herself in this equation. No job was beneath her: running an errand, sending a fax, making copies. She did it all alongside of us. We never felt like employees. ‘We are all in this together,’ she would often say.
''And boy did she mean it! She fostered the team environment with free lunches and board games on Friday afternoons. After a particularly difficult week, she even shut the office down early on Friday and took us all out to a karaoke bar to unwind.''
When asked about this unique treatment of her employees, Slater says, ''I treat my employees how I would like to be treated — it’s just that simple. After all, I’m an employee just like they are. We know that it takes all of us to make the company work. I also want them to see that I will do any job here (as long as I know how) and that I’m not above cleaning the bathroom or doing the dishes if that’s what needs to be done.''
Forced Vacations? How Holidays and Time Off Can Benefit a Company
Slater has a significant and innovative view on creating a work/life balance, oftentimes ''forcing'' some employees to take vacations. A CEO forcing her employees to take time off? That is virtually unheard of in today’s world of 80-hour workweeks. More time spent at the office equals more productivity, right? Not according to Slater.
''I force employees to take vacations because they need to know that there is more to life than work. I feel like I not only employ the person for the job, but in a way I employ that person’s family too. After all, we spend many hours at work every week, and our spouses and children need to know that work is only a means to an end. Everyone needs to spend time away from the grind, to relax and realize that there is more to life than a paycheck or a fancy title.
''This creates a happier life for the employee by enhancing their private life. In turn, an employee feels valued at home and at work. Plus, I like to take time off, and I don’t like to feel guilty that I’m out goofing off while everyone else is working. It also reflects in the way our employees treat our customers. They don’t have to take everything so seriously. The customers know that we take care of business but enjoy the job along the way.''
Slater gives her employees most holidays off, including the week between Christmas and New Year’s. She also staggers her employees’ schedules to allow for employees to pick up their children from school, attend soccer games, and the like.
Says Slater, ''I believe that we all have private lives which require time off once in a while to go to the DMV or the bank or have something fixed at home. I always encourage everyone to take care of these things when they need to. We all cover for each other, and I find this approach makes for less-stressed employees, and in turn everyone respects this privilege without taking advantage of it.''
A Success Story: How Treating Employees Right Affected Micro J’s Revenues
Slater’s company has been consistently successful during the past 10 years, even seeing profits during the major dot-com slump. When I ask what her most valued asset in the company is, she immediately answers, ''My employees.''
''I’m always reminded that there are many places to work, and the employees of Micro J are my most valued asset. At Micro J everyone knows their value,'' she adds.
But how has her unique vision affected her revenues?
''I don’t believe in micromanaging. I just try to get the right people who want a decent work environment, free of stress, and maybe they might even have fun at work every day. In the end, these processes have added to the bottom line of the company. We found that we can rely on fewer employees by making the ones we have happy. This in turn makes our customers happy, which improves their loyalty to the product.''
According to the Great Place to Work Institute, the ''stock growth of public companies on Fortune magazine’s Great Places in America to Work outperformed companies on Standard & Poor’s by 133% to 25% for the five-year period 2001-2005.''
Moreover, author Branham claims that ''revenue gains of 40% or so can be realized by companies implementing work practices that result in high employee commitment.''
Another successful CEO, Harley DeLano, has this to say:
''There are two kinds of CEOs: those who feel they have it made and those who feel responsible for everyone who works for them.''
DeLano fits in the latter category. He has been a highly successful CEO for three different multimillion-dollar companies for the past 15 years. He says he has made decisions as a CEO based on how they would affect the people who surrounded him every day. He has made sure his employees have been properly rewarded and guided throughout his and their careers.
According to DeLano, if you ''surround yourself with good people and take care of those around you, you cannot help but do well.''
Conclusion
The lesson to be learned here is that treating your employees well and fostering a healthy and happy work environment can greatly affect your company’s growth and profits. Branham found ''one undeniable conclusion'' from his research — that ''investing in people is the surest path to business success.''
