Engage Employees

When the concept of open-book management was introduced more than 30 years ago, the intent was to unleash the entrepreneur in every employee and to spur them—and their organizations—to better performance. Since then, countless organizations have opened their books and engaged their employees with positive results to their bottom lines.

I attended a panel discussion this week featuring three fast-growing, award-winning firms that have company cultures that engage all employees for company success.

Tony Schwartz has written a terrific post for the Harvard Business Review on "The Only Thing that Really Matters" in the workplace -- feeling valued and respected. It's so easy to thank someone for a job well done, verbally or in an email, and even a tiny amount of appreciation is often worth more than gold. Yet too often we forget to do so, or slowly and insidiously a culture of one-upping each other in an attempt to feel valued creeps in.

2010 Green Jobs Award Winner E-Light Wind and Solar was profiled in The American Business Journal this week for its fast growth and innovation. Based in Denver, E-Light is a commercial electrical construction company with a focus on large scale electrical systems. To date, E-Light has installed more than 79 megawatts of renewable energy.

Here is a link to a blog post created by UNC Kenan-Flagler Business School exchange student Thanamon Panyadilok about the connection between employee engagement and business sustainability.

(This post first appeared in the Clean Edge Jobs E-Newsletter)   

Fast growing small- to medium-sized private enterprises are a key driver of clean-tech job creation in the U.S. and beyond. SJF Institute, along with our affiliated venture capital fund SJF Ventures, has assisted and invested in many such sustainable companies over the past 11 years.  We have spent a lot of time thinking about exactly what a good job is in the green economy.  How do you fully engage every single employee at a firm in order to maximize both company and employee success?  Employee engagement is one of the fields in which we’ve developed expertise, allowing us to help green entrepreneurs gain a competitive advantage by building strong, engaged teams working in concert for company success.

Green Jobs Award 
To further this cause we developed the first ever Green Jobs Award along with Green For All in order to ensure that “green jobs” are understood to be more than a minimum wage job at a solar firm. Our aim is to celebrate and hold up as a model private companies that are creating green jobs for diverse populations – jobs that provide good compensation, benefits, and wealth building opportunities, along with training and the ability to advance, and community involvement. 

Last week, SJF Institute and Green For All recognized the first ten recipients of the Green Jobs Award: Alvarado Street Bakery, Bioengineering Group, CLEAResult, E Light Wind and Solar, Inc., FLS Energy, Melink Corporation, OPOWER, Petra Solar, Sellars Absorbent Materials, and Southern Energy Management. 

These firms hail from all over the U.S. and represent diverse industries, from renewable energy and energy efficiency to consumer products and engineering. Together they employ more than 1,300 people and their aggregate revenue exceeds $150 million. You can learn more about these winning companies and their green jobs strategies at www.greenjobsaward.org. 

Employees Matter 

In addition, SJF Institute is about to release a major report, Employees Matter: Maximizing Company Value Through Workforce Engagement, in which we profile 24 mostly small- to medium-sized private companies that can directly correlate their high-road human resources practices and broadly shared employee ownership with increased business performance and ability to weather economic downturns. Nine of these are clean-tech companies: three solar-power companies (including Green Jobs Award winner Southern Energy Management), two green builders, two recycling firms, and two sustainable consumer product companies. Profiled companies range from 50 to 3,500 employees and have average revenues of $35 million. Seven are venture backed. 

We use these company profiles to frame and illustrate ten best practices for engaging employees at all levels for increased business success.  We asked them questions about their hiring practices, turnover, company culture, training, compensation, and communication. Here are some of the results: 

All of the companies we profiled have low employee turnover, a significant costs savings (replacing one employee costs anywhere from 50% to 200% of that employee’s annual salary, according to the Society of Human Resources Management). They all have very high customer satisfaction rates and strong year-to-year customer retention.  And ten of them describe ways that employee engagement practices directly helped them survive and sometimes even thrive during the recession. 

So what are the elements of a highly engaged workforce that you can implement at your company? The first one is high-involvement hiring.  Companies we profile in the report stress the need to carefully choose employees with the right skills and a long term fit with the company’s culture. In fact, culture fit was often ranked above specific skills that an employee could learn later. Namaste Solar of Boulder, CO, for example, encourages all employees to purchase restricted stock in the company. Because employees are owners, the firm hires very carefully for long-term culture fit and has only lost three of their 70 employees in the past five years. 

Some of the other elements include extensive training, promotion from within, clear and consistent communication of core company values, sharing critical company success metrics broadly and aligning rewards with reaching those metrics, some degree of democratic decision making, celebrating success, and, where possible, sharing company equity broadly. Not surprisingly, last week’s Green Jobs Award winners practice many of these employee engagement strategies. 

The full Employees Matter report will be released at the end of the year. Send an email to info@sjfinstitute.org to be added to the report mailing list.  

– Anne Claire Broughton, SJF Institute Senior Director

Check out this interview with Zappos.com CEO Tony Hsieh on the importance of hiring the right people for your company's culture. He says the temptation for fast moving entrepreneurial firms can be to hire a person with good skills even if they are not a long term culture fit, but that doing so has cost his company more than $100 million when the wrong hire left and had to be replaced.

At 7 AM this morning I came back from jogging and opened the paper. The top story in today's Raleigh News and Observer is on Durham-based Cree, local and global manufacturer of super efficient LED lighting.