On August 4 I told you about our new feature for email subscribers, a weekly people practices email geared toward improving your company's bottom line.  Tom Walter, CEO of our 2010 Top Small Company Workplace Tasty Catering, commented on that post saying it's a great idea.

This week he shared specifics with me on exactly why he thinks business leaders should sign up for this free email (emphasis mine):

The Weekly Bottom Line-Improving People Practice email should benefit all business leaders.  The world has become commoditized.  The true marketplace differentiator is human capital.  I enjoy learning the Best Practices other companies use with their most valuable asset - their people.

An engaged workforce is typically harmonious, productive and profitable.  These Best Practices eliminate the need to manage.  We have replaced management with effective leaders armed with Best Practices, and the difference has been remarkable.

While Winning Workplaces surely plays only a small part in Tasty Catering's success, you can't argue that they're not doing a lot of things right in their staff engagement that comprises their highly productive workplace culture: As we shared in the company's award profile, in a very tough year broadly and certainly in their industry (2009), their employee leadership development and other strategies helped them earn above-average revenues.

Register now to start getting our weekly, bottom line-improving people practices email FREE in your inbox.

When it comes to staff engagement activities for a more productive workplace culture, how important are newly promoted managers?

VERY (so important, I put the answer to my question in its own paragraph).

In fact, the CEO of one of the most successful small businesses we've honored for their bottom line-enhancing people practices – Andrew Field of Montana-based PrintingForLess.com – told us a few years ago that he doesn't blink at spending half of his time mentoring and modeling tasks with his new managers.  He sees their success as that important to his business' ability to satisfy existing customers and attract new ones, as well as improve internal processes.

If you're reading this, you likely understand and value this connection.  With that in mind, here are three resources to help you make the most of the new managers in your organization:

1. Dan Rockwell's post on succeeding when you’re new - 8 hints for new supervisors on his Leadership Freak blog
2. Our editorial on the importance of new manager training
3. Wally Bock's guest article for us on 10 steps to improve your bosses' performance

Are there any good books or other resources you have turned to and would recommend to other business leaders?  Please share your picks in the comments.

Last month on TIME magazine's Curious Capitalist blog, Barbara Kiviat, citing the New York Times, argued that because

Hundreds of thousands of Americans have enrolled in federally financed training programs in recent years, only to remain out of work ... job retraining is a wash.

This position may make sense from a policymaker or an economist's point of view – and in fact the Curious Capitalist blog carries a tagline saying it's about the economy and markets as much as it is business.

Yet, based on the evidence we see from the applications for our 2010 Top Small Company Workplaces award, small business leaders don't view retraining as a wash.  However, most* do keep tabs on it as a measurement of their failure to attract and retain the best people while aligning those people with the company's needs and deploying effective employee leadership development strategies.

In other words, while they value retraining, they see it as an employee educational investment of last resort.

Consider the responses to our essay question on how people practices contribute to the top line revenue and bottom line profitability from the following three companies:

KeyLogic Systems, Inc., West Virginia:
"At KeyLogic our product IS our people; which we hire through strong recruitment and employee referral programs.  We have a low turnover ratio which has impacted both the top line revenue (allowing for employee to customer continuity) and bottom line profitability by allowing us to focus more on developing our current employee resources through professional training as opposed to the high cost of recruiting, re-training and developing new employees."

Prenova, Georgia:
"Since our managers and executives interact with lower-level employees, they can impart much of their knowledge and information on an as-needed basis, rather than waiting for issues to be discovered (often because of a costly emergency) and spending large amounts of time and labor developing ways to distribute that information. Conversely, employees can quickly and easily access other team members capable of discussing issues, and receive retraining when necessary."

Pro CNC Inc., Washington State:
"Being very thorough in our hiring practices has also led to extremely low turn-over which certainly has an effect on profitability and revenue.  We don't spend a lot of time retraining new hires and can focus on the business of serving our customers."

*I should note that a few firms we've come across – as part of our workplace award as well as our consulting and speaking engagements – don't view retraining as an if-needed effort.  These rare enterprises actively budget for this as part of their staff engagement activities, looking to help those who want to continue working for the company, but in a different area.  They see retraining as a means to hold onto this talent and keep using them to drive results.

Related: Read our review of A Manager's Guide to Coaching, which is aimed at helping organizations decrease their time and money spent on recruiting in addition to retraining.

In a recent post on The Wall Street Journal's The Juggle blog, Jennifer Merritt asked if Summer Fridays still exist.  The "still" part of her question is informed by the realities of the economy forcing companies to cut benefits such as a part or full workday off, and companies that are tight on staff (again because of the economy) needing all the time they can get to best serve the customer or client.

In response to Merritt's question, Summer Fridays do, in fact, still exist.  Among the nearly 500 applicants for our 2010 Top Small Company Workplaces award, 8 specifically referred to reduced hours or a full day off on Fridays during the summer in their applications:

1. The Leadership and Learning Center - consulting firm in Salem, MA
2. Sonoma Partners - software firm in Chicago, IL
3. McGraw Wentworth* - insurance benefits provider in Troy, MI
4. Family Heritage Life Insurance Company - financial services firm in Cleveland, OH
5. NogginLabs Inc - software firm in Chicago, IL
6. Maxons Restorations, Inc. - property damage restoration services provider in New York, NY
7. Rauxa Direct - advertising firm in Costa Mesa, CA
8. Affect Strategies - PR/marketing firm in New York, NY

*This company is a 2010 award finalist

In addition, a review of our 2010 applicants shows that many of them offer the following activities for employee engagement and team building on Fridays (in all seasons):

1. Happy hour
2. Healthy breakfast items – most commonly fruits and bagels
3. Staff lunch
4. Casual dress
5. Yoga
6. Massages
7. Fun run
8. "Praise Box" – measure to reward hard work with awards and prizes
9. Staff outings during sport seasons – most commonly football
10. Friday night movies

Think these Friday-themed people practices are just a waste of money?  Consider that another 2010 applicant, B2B sales training services firm Vorsight in Arlington, VA, told us that, "When we put in place our Friday company lunch and one on one coaching, top line revenue jumped 20%."

What other Friday practices do you do, or have you heard about?

If you have 90 minutes to spare, I have something that's a great use of your time when it comes to expanding your understanding of the payoff of employee engagement and workplace team building activities.

Below is a video of our President's presentation last month at an Entrepreneurial Roundtable hosted by the University of Chicago Booth School of Business.

If you can't see the video in your RSS reader, click here.

The presentation kicks off with our own Gaye van den Hombergh explaining why companies should care about creating great workplaces (starting at 7:30) and the qualities we see as critical to Winning Workplaces, along with some of the people practices used by winners of our 2010 Top Small Company Workplaces award, which were featured in the June issue of Inc. Magazine (starting at 29:00).

Starting at 44:00, Gaye led a panel featuring leaders of this year's two Chicago area winners: Marvin Klein, Founder, PortionPac Chemical Corporation; and Tom Walter, President & CEO and Tasty Catering.  As you absorb the lessons learned and insights of these two leaders, consider their workplace culture practices, which I've listed below respectively, that have led them to success – even in this tough economy:

PortionPac

Selected workplace best practices:

• Offers personal and financial support for employees on a case by case basis
• "Front to Back Day"
• Offers experience to improve personal confidence and communication skills
• Employees have a high degree of autonomy

Business results:

• 2009 revenue up 7% from 2008
• Over the same period their competitors suffered double digit losses

Tasty Catering

Selected workplace best practices:

• Personal financial crisis fund fed into by employees
• Healthy free meals provided to staff on a daily basis
• If an employee comes up with idea and is willing to put in the effort, the company will help finance and support the endeavor

Business results:

• While sales fell in 2009 vs. 2008, it experienced only half the decrease of its industry and remains profitable
• High average employee tenure of 7.5 years

What are your takeaways from watching this video?

In a post on the Business Insider blog re-posted from his own blog, GRP Partners' Mark Suster argues that leaders should solve problems and drive innovation from the top.  He writes,

I challenge you to consider whether you’re top-down or bottom up.  In analysis there are always circumstances for each approach.  But in leadership and entrepreneurism the top-down approach will be the right solution more often than not.

Now, I get that Suster is not saying that leaders should engage employees from the top down 100% of the time, but he is saying it should happen this way the majority of the time.

However, in our experience conducting employee engagement research of small businesses as part of our annual workplace award program, we see that management and decision making can happen in many different ways to lead companies to success in the metrics that ultimately matter: sales and profitability.  Our President detailed four decision-making approaches that run this gamut in these two posts.

Three of the four approaches she wrote about involve bottom-up decision making in some capacity.  And in fact, in the applications we received for our 2010 Top Small Company Workplaces award, we saw bottom-up engagement factor prominently in the qualitative feedback of some firms that are performing quite well, even in this tough economy. 

Check out four case studies that bear this out below.  All four companies have been profitable in the last three years.

Application Question: How have your organization’s people practices contributed to your top line revenue and bottom line profitability?
Response by Bronto Software
8-year-old software firm from North Carolina
2009 sales: $5.1 million; 132% 3-year sales growth
At Bronto we have a sales team who is instrumental to our success.  Because of our organic funding, growth comes from bottom up.  Employees have directly influenced consistent new client growth along with amazing client retention.

Application Question: How does the organization encourage employees to participate in important business decisions?
Response by Barhorst Insurance Group
17-year-old financial services firm from Texas
2009 sales: $6.9 million; 16% 3-year sales growth
Our organization is built on a foundation of bottom up planning!  Every year we have the branch managers provide a sales and expense plan that is fed into our annual corporate plan.  In 2008 and 2009 we completed or long term 2020 strategy to grow from 50 million in sales to 1 billion in sales.  The strategy team was comprised of 10 mid level associates from each department.  The team received feedback from their peers and developed a strategic road map for the future.  This plan includes monthly and quarterly progress reports to the leadership team.  The strategy team will begin rotating new team members through in 2010.  By using a bottom up method employees take ownership for the company's success and failure.

Response by Intermark Media
11-year-old advertising firm from New York
2009 sales: $92.7 million; 161% 3-year sales growth
At Intermark Media we believe changes in the company should be driven from the bottom up.  The employees who are interacting with our clients everyday have valuable insight into what processes work well and what changes need to be made to better meet the needs of our customers.  We encourage all employees to be a part of our decision making process at Intermark Media.  Weekly team meetings allow employees to voice opinions, discuss new ideas and solve problems.  Team leaders encourage input from each and every team member.  In addition to weekly meetings, leaders communicate daily through their email group to vote on awards, discuss ideas and concerns and get feedback.

Application Question: Over the last year, what kind of impact has the economy had on your business?
Response by Man-Machine Systems Assessment
20-year-old consulting firm from the District of Columbia
2009 sales: $8.6 million; 5% 3-year sales growth
The economy has little effect on our business.  We have continued to grow in spite of the economy and I truly believe this is because of the way we operate our business and the culture we have created.  MSA employees feel safe, and know that the owners will do everything within their power to provide work, support their needs, and care for them and their families.  This kind of loyalty is earned, and not bought.  The MSA family is strong and the support we have for one another from the top down to the bottom up allows for strength and faith as we face challenges, like the economy.

Related: We tackled bottom-up staff engagement activities in greater detail with the help of CEOs from two of our previously honored small firms in this webinar.

The business justification for employee engagement focused on their continued, on-the-job learning is easy to understand.  It's a win for employees who increase their skills and become more marketable in their careers; and the company wins because their talent has a greater ability to perform at top levels and to innovate, and it's less of a risk and more of an opportunity to promote from within (saving money on recruiting from outside).

Yet, there are myriad options when it comes to educational employee development strategies.  Where should a small business start?  Maybe a more important question is: Considering each investment in this economy needs to generate several times its amount back in returns, what learning initiatives are most effective for small firms?

Luckily, Winning Workplaces has some real-world answers to these questions to share with you to help you decide how to invest when it comes to this important area of human capital strategies.  Our 2010 Top Small Company Workplaces award application asked applicant companies to give an example of a learning initiative they found to be particularly effective.  Here's how our 20 winners this year responded:

1. A Yard & A Half Landscaping: We spend the equivalent of 1-2 weeks per year offering paid training days for field employees.  Because of the democratic educational setting, by the end of the day, people were helping each other across work crews, and on two occasions, younger employees stepped in to coach crew leaders on machinery that was still unfamiliar to them.
2. All4: For our staff that are in the beginning of their careers and are developing their core consulting and technical skills, we have developed a skills matrix which allows them to know exactly what metrics must be met in order to be promoted to the next position. 
3. Alternative Solutions HomeCare: One interesting program ASH put into place in 2009 was the Dream Manager Program.  Tackling head-on the growing problem of employee disengagement, the program explores the dynamic collaboration that is unleashed when people work together to achieve company objectives and personal dreams.  We had so much positive reaction to this program that we will be continuing it in 2010.
4. Biomark: A couple of years ago we did a several-day team building training.  The effect is that when we employ an idea or theory from this training in our everyday work environment, everyone knows what we are trying to accomplish and is engaged in the process.  This has paid dividends in workplace happiness, turnover, and job performance.
5. Chroma Technology Corp: A few years ago Chroma underwent a full company Lean Manufacturing initiative.  Every employee attended a 2-day workshop and seminar about the fundamentals of Lean Manufacturing.  In addition, 25% of the company was directly involved in two different Lean Mapping and Value Stream courses and projects.  This resulted in $1 million material savings in the first year.
6. Daphne Utilities: We include a large number of our employees in public events involving interaction with our customers.  Here, they work side by side with upper management in events like street festivals and charity fundraisers.  This helps them hear the message being put out from the highest levels, allows top management to get to know each employee a little better, and helps to motivate our workers to take public pride in their work and their company.
7. Dealer.com: We launched uFuel in 2009, a customized online learning management system that was implemented over a 14-month period.  uFuel contains interactive simulations, measures success and knowledge gaps, and creates training programs for areas of improvement.  This learning initiative has been extremely effective at keeping all employees at the leading edge of online marketing best practices and ensuring consistent service for clients.
8. Dixon Schwabl: Our employee development includes an initiative launched by our CEO in 1998 to enhance overall employee communications and allow employees to appreciate each other's differences.  Based on Myers Briggs indicators, it helps frame leadership development, coaching, internal training opportunities, and cross-training.
9. Ginger Bay Salon & Spa: Beginning in 2008 and throughout 2009, we spent significant time with our leadership team opening our books and helping employees understand our financial statements and review our financial performance.  We believe that Open Book Management is likely the main reason that we were able to post results that were not only stronger than our competition, but reflect growth in all areas of our business.
10. MAYA Design: Teaching – many of our employees teach at local universities and we find that allowing this as a paid benefit helps employees learn more about their jobs, how to manage and work with others, and better communication skills.
11. NY Jets: In 2008, the Jets embarked on a first of its kind management development initiative entitled "Take It or Lead It".  Both Business and Football managers partcipated in the sessions.  When this program started, the Jets were in the planning stages of our relocation from Long Island to New Jersey.  HR was able to add in a special section on managing change that prepared mangers for the huge changes employees faced with our relocation.
12. Optimax Systems: The implementation of Job Instruction Training which ensures direction provided from internal trainers is consistent and measurable for effectiveness.  This has allowed us to make sure that people "get it" when instructed on a specific task.
13. Patagonia: Our Employee Development Program temporarily assigns employees to other positions in circumstances where an employee may be out on an extended leave (e.g., maternity leave, an environmental internship, etc.).  Employees participating in this program attain new job skills, have the opportunity to meet more people in the Patagonia community at a new location, and significantly ease the transition back to work for the employee they've replaced.
14. PortionPac Chemical Corp: For 22 years we have held a "Front to Back Day".  Management, office and sales staff spend the day working in the factory.  The "Front" staff gains an appreciation for the skills, talent and physical work that go into making PortionPac, while the factory staff are able to showcase their accomplishments and the attention to detail that goes into making each Pac perfect.  The event fosters communication and suggestions that go back and forth as to how our products can be made better and how the "Front" staff can make life easier for the "Back".
15. Red Door Interactive: We believe that promoting opportunity to change your role at Red Door has prevented talented employees from leaving the company to pursue interests and additional responsibility elsewhere.  Emergent practice areas such as social media and search marketing now comprise over 30% of our total service revenue, and those practice areas are led by people who identified new opportunities and invested in becoming experts by playing to their strengths.
16. Return Path: Most recently our CEO developed and delivered an "Effective Presentations" course.  Content is broken down into small, easily absorbed chunks and reinforced to create a solid foundation that is common for all new hires.  This builds not only a shared vocabulary in our unique business, it builds a shared context.
17. Tarlton Corporation: Our most innovative training program is called Increasing Human Effectives (IHE).  The philosophy behind this training is to help our employees grow personally through this process, which will allow growth professionally.  If they believe in themselves, anything is possible!  Happy employees are productive employees.
18. Tasty Catering: We have 11 advisors/consultants that work with our teams.  Advisors are in the following areas: Banker, Financial, CPA, HR, PR, Marketing, Legal (one for the company and one for the shareholders), IT, Culinary, Dietician and Sales.  The staff benefits by receiving advice from a recognized expert in the field who has larger and smaller clients.
19. The Sky Factory: To further our understanding and experience of the creative process as it applies to our daily work and to the building of the company, we prepared an all-company course with an art historian.  After viewing hundreds of art images and engaging in extensive dialogue it became evident that the process of building a company can (and should) be the same as that of creating a beautiful and lasting work of art.  This notion became practical when a designer aptly observed the skill of a production worker's multiple LED solders.  The fine quality of his work was especially significant because of a recent multi-million dollar fire caused by sloppy work from a competitor's LED system.
20. Van Meter Industrial: One effective learning initiative in our organization is our Foundations training program.  New employees attend this day-and-a-half course near their 90-day milestone anniversary with our company.  Feedback from employees has shown this is fun, interactive, and important training that provides a true insight to our culture, gives the basis for understanding what is important to our company, and sets the tone for who we are and what we represent.

Related: Dive even further into learning activities that will benefit your workplace culture, and your bottom line, by reading our Success Story on ShoreBank.

Image credit: Wikimedia Commons

As Inc. Magazine's profile on our 2010 Top Small Company Workplace award winner PortionPac Chemical Corp got a lot of attention in terms of showing the payoff of employee engagement at a manufacturer – an industry that has been especially hard hit in this economy, and which is not typically known for great workplace practices – today I wanted to share a bit more about another manufacturer: NewAge Industries, one of our 2010 award finalists.

Specifically, I wanted to enlighten you on five practices that leadership of this Pennsylvania-based provider of disposable pharmaceutical processing systems uses to increase competitive advantage.  For 56-year-old NewAge, one solidly quantitative way to define "competitive advantage" is their share price increasing 219% since 2005, while those of their two biggest, publicly traded competitors dropped substantially over the same period.  In addition, the company has never carried debt.

Here are five of NewAge's staff engagement activities that stand out for their revenue-generating and employee retention potential – again, particularly with respect to what other manufacturers are doing right now:

1. Bring on temporary producton employees for up to three months before hiring decisions are made.  This helps NewAge determine if someone is the best cultural fit for the organization, especially when viewed through the lens of employee leadership development potential.
2. Use tough times like these to launch an educational initiative aimed at helping employees understand and address their personal finance concerns.  At NewAge, the CEO in coordination with the accounting department recently hosted five, one-hour sessions with all staff on this.  As a result, many workers have closed the gaps in their personal finances.  This ultimately benefits the company because less financially stressed employees are more productive.
3. Weave cross-training firmly into employee practices and the workplace culture.  Leadership's goal here is to avoid over-hiring in busy times and rampant layoffs in slow times.  They fundamentally believe that this cycle that's so typical of companies is flawed, and they have the numbers to show that their steadier approach works (2009 was their sixth record-breaking year in a row for profits).
4. Pay workers for referrals.  NewAge employees receive a $1,000 bonus for any successful referrals they make.  Management has found that this practice helps to reduce hiring costs and results in higher quality applicants, since employees value the work culture and don't want to be responsible for spoiling it.
5. Put a twist on your tuition reimbursement program and subsidize both work- and non-work-related learning.  NewAge reimburses each employee up to $2,500 annually, and the tuition can be used for any type of learning, whether or not it is directly related to one's job.  Leaders' rationale is that the act of learning anything new and different can spark innovation – not to mention foster employee loyalty.

What people practices, in addition to those mentioned above, do you think directly impact and boost competitive advantage?

Trust building activities may register high on the radar screens of the organizations Winning Workplaces named as 2010 Top Small Company Workplaces in the latest issue of Inc. Magazine, but on the whole among the roughly 27 million small businesses across the U.S., they do not.  These and other human capital strategies are considered by many leaders to be "soft," and therefore, in a down economy, not worth leadership's time and energy compared with other areas of the business.

But as Greg Harris noted on The Science of Work blog yesterday, and as I subsequently tweeted about, Harvard Business Review – long a barometer on where business is and where it's headed – has seemed to focus of late even more on the "fundamentals" of people management.  This means employee engagement strategies to build a more productive workplace culture.

Harris mentioned the May HBR headline "How to Keep Your Star Talent."  Is it a coincidence that this month the AP reported on employment data which show that more employees are jumping ship as the economy improves?

I think not.  Yes, we always see the cycle that in tough economic times, employers don't have to worry as much about retention because people are thankful to have a job, and that in better times they need to pay more attention to it because workers sense a job-seeking advantage and are more apt to leave.  But we are coming out of the Worst Recession Since the Great Depression® – a time when many employers' first reaction was to let go of staff and ask for a great deal of concessions from their remaining workforces.

It's no wonder, then, that employees, feeling beaten down in many cases, are looking for the exits.  This is especially true of top performers, who have a good understanding from their latest performance reviews that they're a strong commodity.

What can keep these folks from leaving?  At a base level, a work environment of trust, respect, and fairness – qualities we point to as one of six building blocks of a winning workplace.

It will be interesting to see how many more leaders and managers put activities designed to maximize trust, such as investment in employee leadership development, at the top of their to-do lists.  And by doing so, moving people practices from the "soft measures" to the "hard measures" column to maintain their competitive advantage.

Your thoughts?

Some of the most (and most vociferous) comments I've seen related to the announcement of our 2010 Top Small Company Workplaces last week in the June issue of Inc. Magazine – firms whose human capital strategies contribute to their revenue growth and profitability – appear in response to this post by Manish Mehta on The Jets Stream blog, on NYDailyNews.com.

There are 87 comments to Mehta's post on the NY Jets as of this writing.  Here's what Bob from garfield had to say:

Evidently, no one at Inc. is a Jet season ticket holder.  If Inc. really wants to see how the Jets PSL sales staff do their job, they should view the movie “THE BOILER ROOM”

I've seen that movie and the Jets' sales environment is about as far from what's depicated in it as can be.  For one thing, the salesmen (I don't recall seeing any women in the workplace in the film) were given zero autonomy in their work.  In contrast, here's how the Jets answered the question in our award application, How does the organization encourage employees to participate in important business decisions?

The Jets culture, which is very employee centric and collaborative, enables the senior management of football and business to encourage all employees to share ideas and contribute even in important business decisions.  There are number of ways that we foster this participation.  The most important way is actually in the design of our new facility.  Before we moved to NJ, we had two offices in NYC and Long Island.  The distance between the offices made communication and collaboration challenging.  In the layout of our new building, open workspaces and open door policies reign supreme. The results have been phenomenal.  Managers and employees from different departments can work in small or large groups to develop creative ideas and solutions to important business issues.  A great example of an idea generated from this workspace collaboration is the "Opportunity Knocks" sales campaign for our season tickets and seat licenses.  With such a well known brand, the Jets needed to let the public know of the rare opportunity available to buy season tickets in our new stadium.  Opportunity Knocks was the result.  In the football world, our General Manager encourages his staff from pro personnel assistants to the Assistant General Manager to be actively involved in player decisions.  The scouts, as they are called, study players from college and other professional teams to develop suggestions and recommendations on who should be drafted on Draft Day or who should be signed as a free agent.  There have been many times that an employee will feel passionately about a player that they feel is worthy of the Jets uniform and the decision will be made to go after that player even if the GM is lukewarm on that particular player.  On both sides of our business and both sides of the ball, we would not be able to be as successful a football team if the employees were not encouraged to voice their opinions, share their creative ideas or be enabled to think "outside the box".

Further down in the comments to Mehta's post, greenjohnny wrote:

Sounds nice, should look good on a belt buckle but who really cares.  It's [sic] pretty good that they can make all their employees take two weeks off without pay and still get an award for best place to work for.

This relates to the Jets' answer to another, topical question in our application, Over the last year, what kind of impact has the economy had on your business? Please briefly explain how your company has responded?  Here's how the NFL franchise responded:

Football is not immune from the economic downturn and recession that has gripped the entire country.  Our local revenue comes primarily from ticket sales and sponsorships.  Our fans (customers) have been affected by layoffs, salary freezes and reductions in work hours.  Our sponsors have seen a dramatic decrease in budgets for spending on advertising.  Consequently, the Jets have been affected by a slowdown in revenue generated by ticket sales and sponsorship deals.  Over the course of 2009, we were challenged to find ways to decrease spending and cut costs.  Since our employees are the key to our success, this exercise needed to be done with layoffs as an extreme last measure.  Many teams around the NFL in the early part of 2009 were laying off their employees to save money.  ...  We froze salaries for the year.  Since we still needed to find extra savings, we made a crucial decision to furlough business employees for 2 weeks versus eliminating positions.  The furloughs were scheduled for the slowest time in our year at the end of June and beginning of July.  Employees had to choose 2 out of 4 weeks to take their furlough.  The response from employees was positive.  They were extremely grateful that they didn't have to say goodbye to a friend.  Our senior management participated as well, which made the program very credible.  It was tough for our employees to lose 2 weeks of pay, but overall the furlough program worked successfully.

In short, the Jets took a page from several of our previous honorees faced with tough decisions and chose to share the pain rather than lay anyone off.  The fact that senior leadership participated speaks volumes and, as you can see, helped maintain their productive workplace culture of ownership and high employee engagement.

I should mention that as part of our employee engagement research for our award, we conducted interviews with staff from different levels within the Jets' organization, and everything they told us about their employee practices, including what's excerpted above, checks out.  Especially for their industry, they are truly a Winning Workplace.

Related: For more on the Jets' new workplace environment, including some great pictures, check out this feature from the June Inc. Magazine.

Photo credit: Nikolas Koenig/Inc.

At Winning Workplaces, we sometimes hear from business leaders that while they acknowledge that happier employees are more productive – and that, in turn, affects revenue and profitability – it can be difficult to tie team building strategies such as special employee awards or allowing workers to bring their dogs to work directly to the balance sheet.

It can be hard to pinpoint the payoff of employee engagement.  Even when leaders work off the feedback of a well-executed employee opinion survey to implement more or better engagement activities, getting bottom line returns to match or exceed estimates is not a science.  This is further complicated by down economies like the one we're in now, as well as the fact that almost no employee practice solutions produce overnight returns.

So I appreciated Dr. Anna Erickson's reframing of this issue in her post yesterday on the Good Company Blog.  She asks, "Are Employers Facing a Deficit of Trust?"  This implies that a workplace culture of trust, respect, and fairness is a form of currency.  It also implies that a deficit of this currency is bad for the bottom line, while a surplus of it strengthens the bottom line.

In fact, the data we gather as part of our Top Small Company Workplaces competition verifies this line of thinking.  The 40 winners and finalist organizations for our award this year have better overall trust building activities in place, and as a result they had higher 2009 revenue than the other 457 applicants (average of $42 million vs. $27 million).  In addition, as I explained in this post, a greater share of the winners and finalists were profitable in 2009, and they have longer average employee tenures and lower turnover.

The short of this is that, to the extent you can implement or strengthen staff engagement practices designed to build greater trust in your workforce, the better it will be for your balance sheet in the long run.

Related: This recent post cites evidence from John Jantsch's new book which finds that stronger cultures also tend to increase referrals – a major source of revenue for most businesses.

For months I've been sharing employee engagement research trends of Winning Workplaces' 2010 Top Small Company Workplaces award finalists – the 40 organizations out of nearly 500 that applied for our award this year.  Many of those blog posts ended with a reminder to look for the June issue of Inc., which would feature the winners of our award.

Well, now the issue is out, as is our press release on the 2010 winners!  Actually, most if not all subscribers already have the issue in their hands; it will be available on newsstands starting tomorrow, June 8.

So now that news of the winners is out, I'm excited to provide more value for you here, in the form of both trends when it comes to the payoff of employee engagement that the winners see, and – perhaps even better for your company – specific best practices that you can learn from and adapt to help grow your business.

In that vein, below are ROI metrics for each of the 20 winners.  Click on a company name for more information about the firm on our website.

• A Yard & a Half (landscaper, Waltham, MA): employee development strategies helped reduce the company's indirect expenses.
• All4, Inc. (air quality consultancy, Kimberton, PA): training and a flat organizational structure have helped the company grow its market share in a down economy.
• Alternate Solutions HomeCare (home health care services for the elderly, Kettering, OH): A focus on creating highly individual employee development plans has helped ASH consistently score higher than the average EBITDA of four of the largest publicly owned home healthcare agencies in the country.
• Biomark, Inc. (electronic ID technology supplier, Boise, ID): Funding growth using internal methods while keeping debt to a minimum has helped Biomark grow while their competitors are shrinking.
• Chroma Technology Corp. (precision optical filter manufacturer, Bellows Falls, VT): The company's focus on customer service and creating outperforming products has helped it grow revenues in a tough economy.
• Daphne Utilities (water and natural gas service provider to the City of Daphne, AL): A pay for performance system, cross training, and coaching have had a triple bottom line impact on the company.
• Dealer.com (online marketing solutions provider for the automotive industry, Burlington, VT): Employee practices such as job rotaton and internal mentoring have increased customer satisfaction, and have also led to awards like Deloitte's Technology Fast 500, which have aided recruiting.
• Dixon Schwabl (Advertising and PR services, Victor, NY): A focus on identifying new hires that will best fit their workplace culture and a strategic talent management program has helped the company to earn a profit in a challenging economy.
• Ginger Bay Salon & Spa (salon and day spa, Kirkwood, MO): Leadership's reliance on employees to revise its service offerings based on declining customer visits helped the firm realize continued revenue growth, and with no layoffs.
• MAYA Design, Inc. (design consultancy, Pittsburgh, PA): Innovative benefits including funding viable, employee-created, complimentary companies has kept productivity high and turnover low.
• NY Jets (NFL member franchise, Florham Park, NJ): Strong benefits and a skills-training program for both business and football managers has increased performance on the fan side (four playoff appearances in 10 years) as well as advertising, merchandising, and other sales.
• Optimax Systems, Inc. (prototype optics manufacturer, Ontario, NY): A strong focus on continuous improvement and other workforce investments helped Optimax to achieve its higest number of bookings ever in 2009.
• Patagonia (technical outdoor clothing and travel gear designer/distributor, Ventura, CA): Though the economy worsened and competition increased in 2009, Patagonia grew revenue thanks partly to people practices including job shadowing, promoting from within, and open-book management.
• PortionPac Chemical Corp (industrial packager/marketer of environmentally sustainable liquid cleaning detergents, Chicago, IL): Practices including executives working on the factory floor and giving workers autonomy helped the company to grow revenue and keep all staff in 2009, while competitors suffered losses and shed jobs.
• Red Door Interactive (Internet/e-business strategy solutions provider, San Diego, CA): An investment in employee development geared toward learning new competencies and practices in emerging technologies helped the firm win related business representing a third of their revenue in 2009.
• Return Path, Inc. (spam-avoidance solutions provider for email senders, New York, NY): Practices including an extensive on-boarding program and learning and team building activities in the workplace have helped Return Path achieve a 70% market share in their sector.
• Tarlton Corp (general contractor and construction management, St. Louis, MO): Extensive training and open-book management helped Tarlton to finish 2009 with a Safety Total Incident Rate below the industry average.
• Tasty Catering (Corporate catering solutions provider, Elk Grove Village, IL): A focus on promoting from within and communicating business performance and activities via weekly, bilingual newsletters were factors in Tasty Catering earning revenues above the industry average in 2009.
• The Sky Factory (factory-direct product manufacturer/distributor, Fairfield, IA): Team building strategies including, most notably, involving all employees in all major decisions contributed to revenue growth in 2008 and 2009, when domestic markets experienced major declines in new construction.
• Van Meter Industrial (wholesale products distributor, Cedar Rapids, IA): Practices such as a program that encourages staff to make small changes in work habits to improve processes as well as incentives including performance bonuses have helped the company consistently rank in the upper quartile performance of financial measurements.

You can learn more about how to build a profitable and productive workplace at the Creating Competitive Cultures (C3) conference that Inc. Magazine is hosting in Denver in October.  Go here for more info on this event.

Regarding the oil spill off the Gulf Coast, we know the following:

• Even with 92,000 employees, BP, the company most responsible for the spill out of several that were vested in the rig that exploded on April 20, has not been able to stop the flow of oil from the damaged well.
• While the federal government has considerable manpower and resources to assist BP in stopping the flow, they must defer to BP as subject matter expert in this crisis (mostly to their engineering team).
• It is urgent that the flow of oil be stopped to save the environment and companies and jobs in the region that depend on a clean ocean, and, from a profit motive perspective, to not lose more of a precious commodity.

We also know that small businesses are the most prevalent employers, representing over 99% of all firms.  Thus, it seems natural to ask if stopping the spill is one, massive opportunity for small businesses to "do well as they do good."

I asked this question this week on LinkedIn.  I've received three answers so far, with five days left for folks to weigh in.  I invite you to add your thoughts.

Related: Here's one answer to the question: Opflex's absorbent foam, which BP has agreed to purchase to help in its cleanup efforts.  I wonder how workplace team building and employee engagement activities are helping Opflex meet demand right now!

Photo credit: Wikimedia Commons

Last week I wrote on employee engagement around group decision making.  Working off an article by the Wharton School, I surmised that as a company grows, its ability to reap returns from making all major company decisions by consensus worsens.  In other words, I asked, Is size the enemy of consensus decision making?

I was pleasantly surprised to see that Bill Witherspoon, CEO of The Sky Factory – an Iowa-based factory-direct product manufacturer and distributor that's one of 40 finalist organizations for our 2010 Top Small Company Workplace award – left a comment.  I thought it was so insightful that it deserved its own post.  Here's part of Witherspoon's response to the question I posed:

The barrier to consensus is not group size or number of participants.  The barrier lies in:

1. Different levels of information among individuals within the operation (the result of transparency or lack thereof).
2. Different "political" agendas within the operation (the result of hierarchical management systems).
3. Lack of uniformly understood goals of the operation.
4. Lack of history - meaning the longer consensus decision making is practiced, the more efficient it gets as the group becomes familiar with the process and develops a deep understanding of the entire operation to which decisions apply.

I can't deny that Witherspoon's relentless focus on building and relying on consensus decision making – including getting rid of the barriers he mentions above – has produced incredible results for his business: Only 8 years old, The Sky Factory grew revenues in 2008 and 2009, both of which were devastating years for their marketplace peers.

Related: Witherspoon mentioned in his comment that the company posts their workplace culture values on their website.  Here's the link to that page and their five "cultural principals."  I think they're a fantastic foundation for team engagement activities, whether or not a company leads by consensus.

Photo credit: KRUU 100.1 FM

This American Public Media interview from last week with Elizabeth Warren, chair of the TARP Congressional Oversight Panel, offers the following takeaways:

• The government provided over $700 billion in TARP funds, largely to big banks, to open up lending.
• But since the bailout, Wall Street banks decreased lending to small businesses by 9%.

I'm going to insert one other fact that I think is relevant, from the SBA:

• Small businesses account for over 99% of all employer firms.

So why aren't the most prevalent and needy employers – small businesses – getting the financing they need to open and sustain their operations?  Warren said in the interview that a major reason why banks are reluctant to lend to small firms is that they feel they can't do it based just on the numbers (P&L, credit rating).  "You actually have to look at a business plan to do that," she said.

This tells me that, however unfair, small business owners and leaders are increasingly forced to take up the role of salesperson par excellence to their bankers – not just providing a top-notch business plan but, ideally, showing how their people resources and workplace culture of ownership contribute to sales and sales growth, as we discussed in these two posts.

Why should small business leaders focus on this at big banks as opposed to local, community banks?  On the one hand, as this report for an American Bankers Association summit held in Washington in March states, 45% of community banks have increased their business lending.  Unfortunately, they control less than $1 billion in assets.  By comparison, the co-author of the best-selling book 13 Bankers reports that the six largest banks control assets equating to 60% of our GDP – roughly $8.5 billion.  As with products in the marketplace, business leaders are inclined to go where the money is.

What do you think about the value of small business leaders reframing their approach when dealing with their bankers, especially at big banks, to go behind the numbers and stress the impact their employee engagement activities have on their current and future success?

Mather LifeWays, a nonprofit dedicated to enhancing the lives of older adults, is near and dear to me.  Near, because their head office is in the same building as Winning Workplaces' offices.  And dear, because the very first article I wrote for our IDEAS newsletter was on the wellness-themed employee engagement programs the organization offers its employees in both Illinois and Arizona.

I got an email from Mather yesterday promoting a series of five webinars they'll be hosting once per month from June through October (you can view the email as a web page here).  The topics that will be covered in each one-hour session include creating a workplace culture of wellness, and creating "multi-dimensional" employee experiences for greater ROI.  (As I have written about before, ROI for wellness programs typically means lower absenteeism and turnover and also decreased medical insurance premiums – all of which are highly desirable by companies in today's economy.)

You can attend the sessions individually, and Mather is also offering a group discount if you register to attend them all.  One nice benefit is that it looks like health educators, HR professionals, nurses, and nursing home admins who attend the webinars will receive continuing education credits.

We're not making any money by telling you about these upcoming webinars – we just care about workplace wellness because the companies in our network do: 58% of our 2010 Top Small Company Workplace award applicants offer a health and wellness program for their employees, and an even greater share of our finalists (77%) do.

Related: This recent post shares 16 common staff engagement activities around wellness as used by our 2010 award finalists.

Considering such major sporting events as the Super Bowl and March Madness, the first quarter is always more conducive to a curious workplace phenomenon: the office betting pool.  These pools enjoy continued support in the spring and summer thanks to baseball, and certainly during other times of the year based on both national and regional events.

But what's the employee engagement practice in your organization on betting pools in the office?  It is probably not formal in the way of practices in your employee manual, but do you have one nonetheless?

This is the topic of our current web poll on our website homepage.  And guess what?  I need you to add your vote to break a tie.  Currently three people say they allow office betting pools, while three do not (the poll went up a week ago as part of our latest IDEAS newsletter on staff engagement activities for a more productive workplace).

Add your vote now!

Thanks in advance.  If you have any thoughts on good or bad experiences with office betting pools, I invite you to comment about them below.

You may have guessed this based on posts like these two – I'm a guitar player.  I've played for 11 years.  It's a talent that's actually come in handy for Winning Workplaces, as I've provided scoring for our Top Small Workplace winner videos, like this one.

Most people are stunned to learn that I'm pretty much self taught.  Lately I've taken to learning some riffs from lessons on YouTube, but for the most part the main way I learn is by listening to music and getting parts down by ear.

I've tried to learn notation, but it hasn't stuck.  I look at this is a weakness, since I'm not as strong as a player who can read sheet music and play something immediately.

I draw a parallel between playing guitar (or any instrument) by ear, and business leaders and managers getting a sense of the level of employee engagement in an organization by measurements outside of the time-tested employee opinion survey.  Kris Dunn wrote about this less involved form of measuring engagement in his post on the HR Capitalist blog last week.

Using the guitar analogy, it would seem based on those who get more session work and other gigs, that guitarists who are better equipped with the knowledge needed to work with other musicians are at an advantage in terms of income and turning this path into a fruitful career.  In the same way, leaders who rely on bigger picture workplace culture assessment tools like employee surveys earn more "income" – both figuratively through the insights they gain that can help them design better team engagement activities, and literally because more highly engaged and satisfied employees strengthen the bottom line through their innovations; and because they tend to stay longer, saving companies on recruiting costs.

So while I play by ear when it comes to guitar, I would not do so and "just wing it" when it comes to assessing employee engagement performance.  It's no coincidence that the vast majority of our Top Small Workplaces use one or more employee surveys, and then act on the robust data they gather to improve their people practices and processes.  We have set most of our workplace consulting clients on a better path through the use of this tool as well.

Where do you stand on the ROI of conducting and acting on the results of an employee survey, versus treating this less scientifically?  Do you think company size is a determining factor here?

Photo credit: Flickr/garibaldi

This week on Fast Company's FC Expert Blog, change leadership specialist Seth Kahan offers 11 lessons for scaling up your organization.  When I looked over his list I noticed how dependent it is on a workplace culture characterized by strong team engagement activities.

For example, Kahan says scaling up must be people and community focused.  "Every plan," he writes, "regardless of its logical excellence relies on engagement, support, and contribution, or it will fail."

Later he urges leaders interested in scaling up to create a Steering Group.  While he describes this group as made up of members "outside the day-to-day activity of the scale-up effort," it would seem that CEOs who have found success forming one or more employee committees to tackle broad as well as niche organizational issues would be ahead of the curve here – especially if the Steering Group does include one or more company employees.

I echo my comment above for Kahan's suggestion to also create a Collaborative Leadership Team.  Put simply, firms that invest in employee leadership development can see a return when they look to organize this type of group that can play such a key role in a major step forward for the organization.

Later on still, in lessons 9 and 11, Kahan stresses the abilities of a leader to really listen to his or her people and engage employees in a team capacity as also critical to scaling up.  As with all of the above leadership traits, these are staples of the most successful small businesses in North America that we know about – our Top Small Workplaces.

Related: Earlier in his career, one of our 2010 Top Small Company Workplaces judges, Bart Houlahan of B Lab, led a successful effort at a basketball apparel and entertainment company that scaled up the business from $4 to $250 million in revenues in just over a decade.  Read more about Bart and our other seven judges here.

I often hear from leaders and managers who ask – especially with their sales and marketing staff in mind – What's the payoff of employee engagement with regard to social media tools like blogs and Twitter?

Here's one answer based on a process I do most days: You can use your blog feed and your Twitter account to quickly go from listening to building your reputation.

Here's what I mean and the steps that are involved:

1. First, you should be "listening" to people and topics that are relevant to your business.  There are a number of ways to do this using technology, but I turn most often to my blog feed, which is just a web-based tool that pulls new posts from the blogs you subscribe to in one place – so they come to you, as opposed to you needing take more time to go out to them to see what's new.

I use Google Reader for my blog feed, but you can use whatever tool you like.  A list of 10 top feed readers (for Windows) is on About.com.

2. Once you have your blog feed reader in place, start subscribing to blogs whose content is relevant to your business.  You should be on the lookout for both those by experts in your field and/or which cover topics that are important to you (such as products or services), as well as those of your competitors, to really get a sense of what's going on in your marketplace.

When you find a blog you want to add to your feed reader, follow the process listed here to subscribe to it.

3. Here's where things get interesting.  You're going to find that as many as 80% of the blogs you follow are also on Twitter.  Today – through a blog I already follow in Google Reader – I found Scott Eblin's Next Level Blog and subscribed to it.  Here's what the Twitter link looks like on Eblin's blog:

I clicked it to reach his Twitter page.

4. Next, in your Twitter account, you'll need to do another, very short process to create your own Twitter list, if you don't already have one.  jens explains how to do this here.  I called the list I created "Blogs I Follow".

5. Finally, once you have a Twitter list going, go back to the Twitter profile of the blogger you want to add to your list.  Once you have at least one Twitter list going, you will see an option in the middle-right of a person's Twitter page with a down arrow called "Lists."  Here's what this looks like on Eblin's Twitter page:

Click it once to show your Twitter list with a checkbox next to it.  Simply click the box, and the person will be added to your list.

This may seem like a long process, but it's only longer at the beginning when you're setting up your blog feed reader and creating your Twitter list.  After that you're looking at only a few minutes per blogger added to your Twitter list.

OK, and now the big question: How does all this help your business?  It does so in several ways:

• It promotes people you add to your Twitter list.  Social media is built on reciprocity, so at some point your "listee" will notice that they're on your list.  Often, they will list you on their list, which broadens your exposure.  For example, counting Eblin I've added 60 bloggers to my Blogs I Follow list, and the 37 Twitter lists that I now show up on include some of my listees.
• You increase your reputation and follower reach by adding one or more lists.  While currently I have 1485 followers of my main Twitter feed, my Blogs I Follow list has an additional 3 followers.  That's not a lot, but it will go up over time as I add more of the bloggers I subscribe to in my blog feed to my Twitter list.
• Marketing potential of your Twitter list followers.  You really have to be careful here, because social media followers are especially averse to spam and even thinly veiled marketing, but if you have a strong enough value proposition and it's presented in the right way, your new Twitter list can serve as an engaged community with which to communicate about your business.  They'll certainly be more highly engaged than the whole of your website visitors on any given day.

Related: Speaking of lists, if you want expert advice on engagement activities for building trust in the workplace, follow these 10 folks on Twitter.

Photo credit: Cookee Corporation