We are in a period of enormous opportunity to help employers fix what’s not working in their businesses. And right now, there is a lot that’s currently not working well in businesses.

I’m reading The New American Workplace, which was published in 2006. It’s a follow-up study to a book called Work in America published in 1973. The book looks at the current state of the how workers and employers interact with and feel about one another and how these interactions differ from 30 years ago. It’s particularly interesting to read it now in 2011 because at the time of writing we hadn’t yet entered the recession, yet there are very clear indications throughout the book that if things don’t change with the way employers interact with and treat their employees, there will be some significant consequences. Of course, now we’re watching those predictions actually play out.

Employees

So many businesses have been in such a decline in the treatment of their employees over the past 30 years that many business owners and managers today don’t even know what it means to train your workforce and take care of them in exchange for hard work and loyalty. We lived a bubble of economic growth where business grew at such rapid rates in spite of continual cuts, squeezes, and off-shoring that we believed the way we were managing companies was clearly good management. Or was it? Was it good management and ownership? Or was it circumstantial and merely fortunate due to growing economic conditions?

Over this 30-year period, employees have worked harder and increased average company productivity by 65%, yet at the same time, average wages only increased 22%. This has been a great boon for top executives and shareholders because of the enormous revenue gains from this productivity and profitability increase.

However, it’s clearly proven to be a great de-motivator for the folks doing the work. Right now, according to Met Life Study of Employee Benefit Trends, one in three employees hopes to be working elsewhere in the next twelve months. A clear indicator that employees are sick and tired of the way they’re being treated.

Employers

What would happen if your agency lost 33% of its staff? A big huge blow to the revenue, profit, productivity, and morale, I have no doubt. This leads to other issues down the road with damage to your customer service and brand reputation, R&D opportunities, and on to business continuity. It all rolls down hill, and if it gets started, it’s extraordinarily difficult to get it stopped and going back up that hill.

These very same ideas apply to your clients. You can guarantee that if you are thinking about and struggling with these issues, so are your clients.

The opportunity is ripe to turn things around. And the opportunity is yours for the taking, if you choose.

Clearly things have changed, and I would guess that many of these long-time owners and their managers don’t even understand what good quality leadership needs to look like today. Many don’t even know what they don’t know.

  • The old way has been management by pushing and prodding people to just meet the minimum expectations of the job.
  • Now empowering employees to be self motivated at work and take on projects because they want to is the new management…rather leadership.

Effectively leading a team in this way requires two foundational elements:

  1. Have excellent communication around the vision and goals of where the company is going and why. Be sure to communicate they “why” in ways that appeal to the individuals – not just because the company wants to be more profitable.
  2. Figure out what performance metrics really make a difference in reaching those goals, communicate those to the team so they understand their roles in relation to the goals, and regularly communicate the ongoing status to team – good, bad, or indifferent.

There is a great study from Stanford University, Management Practice & Productivity: Why They Matter, that very directly ties the productivity and profitability of a company to good management and leadership – communication of the strategic direction of the business and progress toward goals were at the top of the list. As a matter of fact, the study results showed that an investment in quality management practices (such as these and others) were equivalent to large increases in existing labor and capital.

Notice that these things we’re talking about here require no capital investment – simply an understanding of the importance of good management, the time to plan, and a commitment to making it happen.

There is certainly more you can go on to do that would require financial investment around training, systems, processes, etc., but it’s got to start with these fundamental pieces. Once the momentum starts, it makes sense to continue exploring other options for further training and growth within the organization.

Taking the time to study and learn quality business practices that you can take to your clients – right now – will prove transformative. For them and you.

Speaking as a current and former business owner, I can attest that if you help someone fix something significant in his or her business, you’ve got a client for life (assuming, of course, you continue to influence their business as time goes on).