While attending a Great Place to Work Institute annual conference an organizational consultant told the story of a client who prominently displayed posters throughout their offices with the message, “Our valued employees are always treated with trust and respect.”   Yet the consultant noticed employees underwent exhaustive and intrusive security searches when entering and exiting the offices each day.  It was obvious the employer did not really trust their people.  The consultant observed the employees were quite uncomfortable with the invasive nature of the security process.

Considered a highly unusual practice for a civilian organization with very little security concerns, the consultant questioned the leaders about the conflicting message of “trust and respect” while employees were subjected to daily body searches. The organization stopped the security searches.

Avoid Conflicting Messages

In this case, the leaders were oblivious to the conflicting message of building trust and the ongoing practice of their security measures. That’s why business leaders should carefully consider the environment they want to create for their employees.  A well planned and executed people strategy will help you avoid these big, hairy contradictory messages that create barriers between employees and management.

Since corporate culture flows down from the top, determine in advance what message you want your employees to receive through your leadership team’s actions.

People Strategy is Mission Critical

When preparing your business plan, seriously consider the people strategy component of your enterprise.  People strategy is as important as your marketing strategy or finance statements. Many CEO’s will boast in their annual reports, “Our people are our most important asset” because that is what a CEO is expected to say in print or on camera.  But in reality do most CEO’s develop a Great Workplace strategy where employees are treated as whole persons and where leaders are measured on their soft skills? Based on the vast numbers of unhappy, unfulfilled, disengaged and burnt out American workers across this great nation, my educated guess is a resounding “no!”

A business owner should seriously consider their written and unwritten people strategies and make room for this subject in their business plan, whether you have ten or ten-thousand employees.  Even solo-practitioners rely on other people, including business associates, partners, affiliates, vendors, and other professionals, to accomplish their goals.  A well-developed people strategy is critically important to any businesses long-term viability.

Most Successful People Like People

First of all, it helps if you like people. To some leaders, overseeing people is like dealing with the IRS: they avoid them at all cost.  I cannot count the times leaders have told me they hate dealing with people issues.  However, many leaders allow the people component of their business to be formulated by chance.  It is difficult to succeed in business if you don’t like people.  It is not a good idea to outsource your people function to uncaring, unattached outsiders.  Even if you outsource merely the transaction components of human resource management, a leader cannot outsource the employee relations component without disastrous consequences.

If business leaders are not involved in corporate life, the company’s culture becomes a process of evolution, mutation, and happenstance in an uncaring environment.  These are great ingredients for stirring up a prison riot, but not such a great way to develop a great working environment.

Sometimes the temptation is to ignore people problems altogether and hope the problems magically disappear.  However, poor decision-making, or lack of decision-making, can lead to a toxic work environment and a multitude of people issues.

Positive People Practice Questions

When developing or evaluating your business plan, ask and answer the following Positive People Practice (also known as P3) questions when creating a People Strategy section in your business plan:

• Company Culture - Every company has one and no two are alike.  What type company culture do you want for your enterprise?  The culture will typically mirror the personality of a strong leader or CEO. It is good to establish in writing the foundation of the company’s personality.
• Flexibility - How flexible will your company be with employees?  Will you automatically say “no” to reasonable requests or seriously consider and evaluate employee requests for work/life flexibility?  Flexible employers are known to be more productive and profitable.
• Results Only – Are you prepared to base employee performance on results rather than the outdated practices of brown-nosing and face time?
• How Results Happen – How results happen are as important as the results. Will employees and leaders be accountable for their behavior in getting work accomplished?  Make sure results at any cost is not condoned by your leadership.
• Telecommuting – Will employees have the flexibility to work away from the office as long as they get their work done on time and with the quality expected? Today’s technological advances have made telecommuting a practical solution for a number of positions.
• Recruiting by Cultural Fit – Will you carefully screen each new hire to determine if they will live and work according to your company culture? Potential new leaders should also be subjected to a culture fit analysis since this is where many problems crop up.
• Dress Code - How are employees expected to dress for work? Business, business casual, casual, beach attire? Make sure leaders dress like your employees too.  Opportunity seeking leaders will be tempted to dress up in a dress down environment to gain a psychological advantage over other employees.
• Corporate Values - What are the values and guiding principles of your organization?  These guidelines communicate a great message to job applicants and help existing employees and leaders make decisions when faced with difficult circumstances?
• Code of Conduct - How are employees and leaders expected to act during the work week?  What is considered acceptable or unacceptable behavior? Is business ethics taken seriously?
• Jerk-Free Workplace – Will you consider instituting an anti-bullying and jerk-free workplace policy where workplace terrorists are terminated after one official warning? Unfortunately the incivility of our society is creeping into the workplace and business leaders need to stop hiring jerks at work.

Seriously consider these people strategy issues when developing your business plan and your chances of outlasting, outperforming and outmaneuvering the competition will increase exponentially.

The benefits of creating a Great Workplace cannot be more evident than when the economy turns south.  The U.S. and World economies are subject to cyclical movements in both positive and negative directions.  It is a given; there will be periods of growth and expansion, and conversely, there will be periods of restriction and conservation. We know with certainty that each cycle, and the period in-between, is coming.  Companies ride high during times of expansion, growth and spending, and hunker down during the slow, restricted and conservative economic periods.

Unfortunately, the companies who live in a short-term world and do not develop a long-term Great Workplace strategy will eventually succumb to the enemy of average and/or economic conditions.  At best, they are only prepared for economic high times.  The moment trouble comes, however, these ill-prepared organizations eventually close their doors.

On the other hand, companies who have conscientiously developed Great Workplaces where people thrive are prepared for both sides of economic weather conditions.  They ride the waves when they are high, taking advantage of all the good momentum.  And when economic conditions turn bad – and they will – companies with great work environments seem to ride out the storm in a calm and collected fashion; even picking up business from alternative sources, adding new clients, capturing untapped markets, pulling in revenues from varied sources and innovating their way out of an economic disturbance.

Why do companies with Great Workplaces survive economic storms?

The people inside Great Workplaces make the difference because their company truly cares for them by creating a sustainable, flourishing culture.  As a result, a majority of their energized employees are engaged and running on all cylinders. The benefits of creating a Great Workplace are numerous.  As chairman of the board, CEO, business owner or start-up entrepreneur, the proven benefits of building a Great Workplace will likely make your company a powerful force even in the most difficult of times.  Why? The benefits of creating a Great Workplace have been researched and proven by the Great Place to Work Institute:

• Higher productivity
• Higher profitability
• Better customer satisfaction
• Lower staff turnover rates
• Greater number of applicants for open positions
• Attraction of the best and brightest talent
• Less resistance to change
• Lower health care costs
• Lower workers’ compensation costs
• Lower absenteeism rates
• Lower presenteeism rates
• Higher levels of cooperation
• Higher quality products and services
• Increased innovation and risk taking
• Higher returns to stockholders

When you build a winning team with a great work environment, employees will take care of business during both good and bad times. It is a winning formula for building a long-term, growing and profitable organization.

The Good News

It is never too late to begin the process of building a Great Workplace.  Any company can get there from where they are today as long as the top business leader is the one leading the charge.  It is better to invest your time and resources to develop a Great Workplace and survive an economic storm than to carelessly leave your company culture to chance and file Chapter 11 when the next storm blows in.

Edward R. Murrow, the famous American broadcaster depicted in the movie Good Night, and Good Luck once said, “The obscure we eventually see, the completely obvious takes longer.”  In your quest to building a successful company, do not assume the creation of a great work environment is complicated.  In fact, the steps are quite simple, if not completely obvious from a people practice perspective.

Company Culture Flows from the Top

In the people practice profession, there is the tendency to over-complicate work culture and how it impacts the bottom line.  The basic principles of a great work environment are quite straightforward, and rest entirely on the leadership’s shoulders.

One of the most important business strategy questions leaders can ask themselves is, “How do I create a great work environment that attracts, motivates and retains the best and brightest talent?”  You might be surprised the answer is not any of these; above market compensation, best in class benefits, top trends in office space design or technological superiority.  The answer is summed up in one, very important, highly-relational, powerful word: trust.

Definition of a Great Workplace

The Great Place to Work Institute, after twenty years of thorough research on the top high-performance companies in America, formulated their definition of a great workplace as a place where employees “trust the people they work for, have pride in what they do, and enjoy the people they work with.”

A leadership team who can be trusted by employees is well on its way from average performance to a great workplace where magic happens.  The good news is employees are not necessarily looking for expensive perks, like coffee bars, gyms, restaurants, game rooms, hair salons and spas, daycare, on-site doctors and nurses, media centers, theaters, dry cleaning, or concierge services.  Although these benefits are very nice options, they do not guarantee a great work environment.

When leaders sincerely care for their people and build an environment of trust, employees will believe in the company mission and develop respect for their co-workers.  Trust is like the secret ingredient found in Coke.  Without it, the recipe will not work.  Many have tried to copy great workplaces without trust and failed.  Without trust, the environment will not click, no matter how grandiose the company’s compensation, benefit and work/life programs.  It is amazing how creating an environment of trust, the missing ingredient in many average performing companies, will hasten the transformation of your company into a great workplace with the potential to outperform your competition many times over.

The Seven Leadership Principles

How does a leader create a great workplace through the simple ingredient of trust?  Robert Levering, founder of the Great Place to Work Institute, who has many years of experience researching successful companies, states there are seven principles leaders must follow to build and maintain trust in their organization:

#1 – Leaders share information. The leaders of great work environments are willing to share information with their entire workforce.  They are not afraid to provide employees of all levels important updates about the company’s status, whether financial, non-financial, positive or negative.  Withholding important company information drives a wedge between employees and leaders, creates misunderstandings, fear and distrust among employees who spend most of their waking hours at your place of business.  Since employees are investing their lives with you, isn’t it likely they deserve to know where the company has been, where it needs to go, how it’s performing and how their efforts make a difference?  Open up the internal information highway and you are well on your way to greatness.

#2 – Leaders are accessible. Leaders in great workplaces do not hide in their execu-caves.  Effective leaders get out of their offices and walk around and mingle with employees.  These same leaders allow employees to voice concerns without fear of reprisals or losing their jobs.  Many of the 100 Best Companies hold regular lunches with employees where leadership shares information, shows sincere concern for employees and listens to their concerns.  More importantly, leaders follow-up on employee concerns and improve the work environment with each interaction.

#3 – Leaders are willing to answer the hard questions. Trust is built when employees see leaders who are not afraid to stand up and field the hard questions.  Employees do not expect leaders to have all the answers, but develop strong trusting relationships with leaders who honestly state they do not have an answer but will respond at a later date.

#4 – Leaders emphasize two-way communication. Leaders who actively listen to employees concerns and engage in two-way communications earn the trust of employees.  Most management teams are good at sending communications or orders down the pipelines, but not necessarily comfortable with receiving feedback from their workforce.  Great workplaces have open, two-way channels of communication.

#5 – Leaders always deliver on their promises. Miss this one and you’re done.  Making a promise and not following through is like going thermal nuclear on your workplace; people get burned.  Employees want to know if leaders will deliver on their promises.  This includes the small things as well as the big things.  Treat your employees like your best customers and you should perform very well in this area.

#6 – Leaders show recognition and appreciation. Deep down employees crave recognition for a job well done.  Receiving recognition and appreciation is one of the biggest unmet needs employees have in today’s society.  Go ahead and make a big deal about employee and team accomplishments.  Brag on your employees in front of other employees  Then sit back and watch a special, positive, energizing, company culture develop in front of your eyes.

#7 – Leaders demonstrate sincere, personal concern. According to the most recent Towers Perrin Global Workforce Study, the number one driver leading to employee engagement is determined by whether senior management is sincerely interested in an employee’s well-being.  You can’t fake sincerity.  It shows in your attitude and other non-verbal clues.  If the leaders are not sincerely concerned for their employees as people, your best talent will likely move to a place where they are better appreciated.

Live by these leadership principles and your organization will soon be inundated with resumes from the best and brightest talent in your industry wanting to work for your organization.

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This article was originally written for The Business Owner Journal and will appear in the November/December 2008 issue.

Most American workers want to put in a good day’s work. There is a deep desire created in all people to be productive, creative, innovative, inventive, and to leave this world in a better condition. However, our American corporate culture is losing the battle for the hearts and minds of employees and has fallen far from the mark. Rather than working to win the hearts and minds of employees, corporations are driving a stake in the soul of the American worker. After a two-year feasibility study, the non-profit organization Winning Workplaces identified in their Case Prospectus the cruel realities we face in our current work environment.

• The American workplace, a source of our nation’s strength, is also at the root of considerable burdens for many individuals, families and communities.
• Trust and respect in the workplace is breaking down, with less than 40% of employees believing or trusting their senior managers.
• Employees are feeling less control over their jobs.
• Opportunities are shrinking in the workplace.
• Employees are often forced to choose between work and family due to company demands.
• Workers are becoming more detached from their employers due to globalization and outsourcing.
• Work is dominating the life of the American worker.
• Employees spend, on average, 46 hours a week on their job, not counting time online at home or linked to a BlackBerry away from the office at night or on weekends.
• When jobs are satisfying and challenging, it invigorates employees in other areas of their lives.
• When the workplace deflates, frustrates and demeans people, workers are robbed of their energy and desires needed to optimize performance as spouses, parents and citizens.
• Up to 66% of employees say they regularly experience high levels of stress on the job, a significant and growing public health concern leading to drug abuse, mental health problems, accidents and absenteeism.

There is no better time than today to help companies create great workplaces. Our citizens need great workplaces to be fully productive. Our children need their parents to work in physically and mentally healthy work environments to prevent toxic workplace residue from coming home. Our society needs great workplaces to reap the rewards of successful employees and organizations. Non-profit organizations benefit from the increased volunteerism that happens as a result of great work environments. The health of our nation depends on the creation of great workplaces where employees are treated respectfully. And business owners need great workplaces to survive global competition and enjoy long-term financial success. Organizations where the employees have identified their workplace as a great place to work are far superior economically and socially. The Great Place to Work Institute has shown in its research it pays to provide a great workplace. Win the hearts and minds of your employees and you will outperform your competition and increase the return to your shareholders.