At the Helm Steering Your Ship to Avoid Wrecks · “Endeavors succeed or fail because of the...

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Annual Conference April 30 May 2, 2014 Tan-Tar-A Resort Osage Beach At the Helm Steering Your Ship to Avoid Wrecks A Special Seminar by

Transcript of At the Helm Steering Your Ship to Avoid Wrecks · “Endeavors succeed or fail because of the...

Page 1: At the Helm Steering Your Ship to Avoid Wrecks · “Endeavors succeed or fail because of the people involved.” (Colin Powell) "Never try to teach a pig to sing; it wastes your

Annual Conference

April 30 – May 2, 2014

Tan-Tar-A Resort – Osage Beach

At the Helm – Steering Your Ship to

Avoid Wrecks

A Special Seminar

by

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Annual Conference

April 30 – May 2, 2014

Tan-Tar-A Resort – Osage Beach

At the Helm – Steering Your Ship to

Avoid Wrecks

A Special Seminar

by

P.O. Box 1848

Bristol, TN 37621

(423) 764-4127

Fax: (423) 764-5869

web site: www.sescomgt.com

e-mail: [email protected]

©SESCO Management Consultants

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Table of Contents

The Importance of Managing Human Resources

Why is Performance Management So Important .......................................................................1

Performance Management Directly Impacts .............................................................................1

Performance Realities ................................................................................................................1

Staffing and Performance ..........................................................................................................2

Performance Management = Profitability ..................................................................................2

Performance Management Quotes .............................................................................................3

Failure to Manage ......................................................................................................................3

Cost of Turnover ........................................................................................................................4

Motivation

How Much Do We Know About Employee Motivation? .........................................................4

How Do You Develop a Motivating Environment? ..................................................................6

Motivating Principles .................................................................................................................7

Hygiene Factors .........................................................................................................................7

Motivator Factors .......................................................................................................................7

Effective Leadership is The Key to Good Morale and Motivation ...........................................8

The Basic Principles of Leadership/Management .....................................................................8

Good Morale/Motivation Is Promoted By .................................................................................8

Creating a Motivating Environment ........................................................................................10

What Employees Need and Want from Their Employer .........................................................11

The Top Ten On-The-Job Needs .............................................................................................13

Effective Ways of Destroying Employee Morale ....................................................................14

Characteristics of a Superior Leader ........................................................................................15

Performance Management ..........................................................................................................16

Why Manage Performance? .....................................................................................................17

Purpose of Performance Management .....................................................................................18

Benefits of an Effective Performance Management System ...................................................18

Keys To Successful Performance ............................................................................................19

Barriers to Effective Performance Measurements ...................................................................21

Qualities of Good Measurement ..............................................................................................21

Starting to Set Personal Goals..................................................................................................21

What is Constructive Feedback? ..............................................................................................23

Giving Constructive Feedback .................................................................................................23

Top Ten Reasons Performance Appraisals Can Fail ...............................................................24

Supervisor’s Checklist for a Performance Appraisal Interview ..............................................24

Performance Evaluation Tips For Supervisors ........................................................................25

Common Appraisal Errors of Performance Appraisals ...........................................................26

Handling Employee Behaviors ................................................................................................27

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The Importance of Managing Human Resources

Why is Performance Management So Important

People are the most valued asset and the greatest investment

Delivery of all organizational goals and mission depends on people

Most managers are poorly equipped to manage performance (technically but not managerially

proficient)

Performance Management Directly Impacts

Employee Retention, Engagement, and Commitment

Employee Productivity and Efficiency (all levels)

Process Performance

Service Excellence

Financial results

Performance Realities

Employee Performance Rating

A 9

B 9

C 5

D 5

Average Performance Level of Departmental

Team 7

Whose score is this?

What opportunities exist?

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Staffing and Performance

COMPANY A Sales

$1,000,000 Average Rate Per Hour

10 Employees (20,800 hours)

Payroll @25% =

250.000

12.02

COMPANY B Sales

$1,000,000 Average Rate Per Hour

13 Employees (27,040 hours)

Payroll @25% =

250.000

9.25

Supervisors more than anyone else determine payroll staffing by the quality of persons they develop and

train to perform the services.

Performance Management = Profitability

100% Revenue

5% Profit Needed dollars for growth

25% Wages Salaries Benefits

Payroll is most variable cost we administer

70%

Equipment Supplies Electric Taxes

Insurance Etc.

Most of these expenses are mandated by others

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Performance Management Quotes

What High-Profile Business Leaders Have Said

“My main job was developing talent. I was a gardener providing water and other nourishment to

our top 750 people. Of course, I had to pull out some weeds, too.” (Jack Welch)

“The conventional definition of management is getting work done through people, but real

management is developing people through work.” (Agha Sahab, Founder of Bank of Credit &

Commerce Int’l BCCI)

“(A) myth of management is that success equals skill.” (Robert Heller)

“Executives owe it to the organization and to their fellow workers not to tolerate nonperforming

individuals in important jobs.” (Peter Drucker)

“Endeavors succeed or fail because of the people involved.” (Colin Powell)

"Never try to teach a pig to sing; it wastes your time and it annoys the pig.“ (Paul Dickson)

"So much of what we call management consists in making it difficult for people to work.” (Peter

Drucker)

Dealing with Poor Performance

“I feel that there is no greater disrespect that you can do to a person than to let them hang out in a

job where they are not respected by their peers, not viewed as successful, and probably losing

their self-esteem. To do that under the guise of respect for people, is to me, ridiculous.” (VP

Strategy and Corporate Relations Hewlett Packard)

“It’s incredibly demoralizing for the rest of the team if you don’t move poor performers out – and

the leader looks blind and out of touch.” (Senior Executive, Arrow Air)

Failure to Manage

Results: “Lose the best, keep the rest…”

Costs of Turnover (direct and hidden)

Direct: Recruitment, replacement, on-boarding, training and development

Indirect:

Additional burden on staff (coverage and training)

Adverse effect on morale, knowledge drain

Adverse impact on patients (image, relationships)

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Cost of Turnover

Cost Factor Cost Formula

($25,000 salary) Amount

Poor performance 10% of salary $2,500

Performance deficiency during

replacement 10% of salary $2,500

Cost of screening and hiring 5% of salary $1,250

Indirect cost such as morale 10% of salary $2,500

Motivation

How Much Do We Know About Employee Motivation?

Put a check () on each of the appropriate lines.

1. If they didn't need the money, the majority of people would not work.

___ Agree ___ Disagree

2. A clean, comfortable working environment will motivate most people to work more effectively.

___ Agree ___ Disagree

3. For most people, having job security reduces their need to work as effectively as they can.

___ Agree ___ Disagree

4. For some people, a distinctive job title is a greater motivator than more money.

___ Agree ___ Disagree

5. The opportunity to participate in problem solving and decision making is a prime motivating factor

for a large number of employees.

___ Agree ___ Disagree

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6. A supervisor's expressed confidence in an employee is almost always a strong motivating influence.

___ Agree ___ Disagree

7. For most employees, money is by far the single most powerful motivator.

___ Agree ___ Disagree

8. Most employees prefer not having decision-making responsibilities.

___ Agree ___ Disagree

9. Pensions, medical insurance, and other fringe benefits are major factors in motivating employees to

work effectively.

___ Agree ___ Disagree

10. Awards and other forms of public recognition are strong motivators for a significant number of

employees.

___ Agree ___ Disagree

Answers – Discussion Topics

1. If they didn't need the money, the majority of people would not work.

Disagree. People work for many reasons other than money. Work can be a source of personal

satisfaction related to achievement or to serving a useful social purpose. The workplace is a source of

friendships and social interactions. A job may confer status on an individual, and work is often a

source of self-esteem and self-actualization.

2. A clean, comfortable working environment will motivate most people to work more effectively.

Disagree. Good working conditions tend to be satisfiers rather than motivators. The absence of good

working conditions can often be a source of dissatisfaction and, thus, may be an impediment to

effective work; but the existence of good working conditions rarely motivates effective performance.

3. For most people, having job security reduces their need to work as effectively as they can.

Disagree. People who have job security and yet do not work effectively are not less productive

because they are not threatened by the loss of their jobs, but because their jobs are not structured in

ways that will motivate them.

4. For some people, a distinctive job title is a greater motivator than more money.

Agree. There are people for whom status is more important than money.

5. The opportunity to participate in problem solving and decision making is a prime motivating factor

for a large number of employees.

Agree. While it is true that there are many people who do not welcome decision-making

responsibility, many more are motivated by the opportunity to participate in these activities.

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6. A supervisor's expressed confidence in an employee is almost always a strong motivating influence.

Agree. The evidence is strong that such expressed confidence is highly motivating for most people.

7. For most employees, money is by far the single most powerful motivator.

Disagree. Except for people whose compensation is clearly tied to performance, money does not

have great staying power as a motivator. It can be a great dissatisfier if any employee perceives

inequity in his/her compensation.

8. Most employees prefer not having decision-making responsibilities.

Disagree. While this is true of many employees, many more are motivated by involvement in the

decision-making process.

9. Pensions, medical insurance, and other fringe benefits are major factors in motivating employees to

work effectively.

Disagree. Fringe benefits are like good working conditions for most people—they are satisfiers

rather than motivators.

10. Awards and other forms of public recognition are strong motivators for a significant number of

employees.

Agree. Virtually everyone is motivated by recognition.

How Do You Develop a Motivating Environment?

Morale is defined as the “…willingness to perform assigned tasks, cheerfulness and discipline.” We often think that morale is tied directly to productivity – when productivity is high, then morale must

be high, whereas if morale is low so goes productivity. While there is a relationship between the two,

morale can be more accurately tied to the relationship between the manager/supervisor and the

employee.

Morale and motivation are often used synonymously. Motivation is the reason “why people do the

things they do.” So how can you motivate people and keep the morale level high? Unfortunately, studies

have shown that you really cannot motivate another person. Motivation comes from within – it is a result

of a person’s individual perceptions, needs, and desires. People can only motivate themselves. Having

said that, it is important to realize that supervisors can have a direct impact on an individual’s motivation

by creating an environment within which a person will want to motivate him/herself.

Motivation can be defined as the act of getting a person or a group, each with his or her own distinctive

needs and personality, to work to achieve the organization’s objectives, while also working to achieve

individual objectives. This is very different from manipulation, which is a process that moves people

toward ends that the supervisor desires – without regard for the feelings and needs of the employee.

Manipulation often uses threats, short-term rewards, or promises. True motivation must be done with

respect for the other person. It is accomplished by linking what the individual desires with the specific

goals, tasks, and behaviors that the job requires.

"People often say that motivation doesn't last. Well, neither does bathing -- that's why we recommend it daily." -- Zig

Ziglar

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Motivating Principles

You cannot .

All people are .

People do things for .

A person’s strength overused may become .

"Motivation is a fire from within. If someone else tries to light that fire under you, chances are it will burn very briefly." -

-Stephen R. Covey

Hygiene Factors

Pay and Benefits

Company Policy and Administration

Relationships with Co-workers

Physical Environment

Supervision

Status

Job Security

Motivator Factors

Achievement

Recognition

Work Itself

Responsibility

Promotion

Growth

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Effective Leadership is The Key to Good Morale and Motivation

Good morale and motivation are determined by the leader’s:

I. ATTITUDE Attitude toward company

Attitude toward employees

Attitude toward work

II. COMMITMENT Commitment to company

Commitment to good employee relations

Commitment to good work

III. EXAMPLE How he/she acts

How he/she talks

The Basic Principles of Leadership/Management

The key to successful leadership is following a consistent pattern of interaction with others. Effectively

handling difficult situations while increasing the performance of your work group can make the difference

between your success and mediocre performance. The following are five key principles for successful

leadership that will help you maintain an environment suitable for strong motivation.

1. Always focus on the situation, the problem, or behavior -- not the person.

2. Build the person’s self-esteem.

3. Establish and maintain a constructive relationship.

4. Take initiative to make things better.

5. Lead by example.

"Far and away the best prize that life offers is the chance to work hard at work worth doing." -- Theodore Roosevelt

Good Morale/Motivation Is Promoted By:

OPTIMISM We can do it.

We can do better than we are doing.

We can accomplish anything.

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ENCOURAGEMENT You can do it.

You can grow.

AFFIRMATION You are important.

You are doing well.

INTEREST Interest in as a person (whole).

Interest in growth.

Interest in problems.

Interest in other than work activities.

MOTIVATION Positive motivation.

Motivate at level of interest.

PLANNING Work well-planned.

Plans known to all.

Individual planning.

CARING Open to person needs.

Care expressed.

Care consistent.

Care genuine.

CONCERN Concern for them as a person.

Concern for safety.

TEAMWORK We are all in this together.

Team growth is planned.

RESPECT Respect for person.

Respect for individual needs.

Respect for opinion.

Respect for ideas.

RECOGNITION Praise for good job.

Consistent praise.

TRUST Trust person to do job.

Trust can be depended on.

FAIRNESS All are treated alike.

All follow game rules.

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Creating a Motivating Environment

Develop the Necessary Systems to Effectively Lead/Manage Your Most Valued Asset

Human Resource Management Systems Checklist:

___ Up to date, effective and compliant Employee Handbook

___ Americans with Disabilities Act

___ Up-to-date Family and Medical Leave

___ Social Media

___ Cell Phones/PDA’s

___ Safety and Health

___ Harassment

___ Substance Abuse

___ Confidentiality

___ Ethics

___ Job description articulating position responsibilities and performance expectations

___ Compensation Opportunities – compensation program with clearly articulated compensation and

benefit opportunities – based upon performance

___ Internal equity

___ External equity

___ Affordability

___ Overall Fairness

___ Effective Leadership – training managers

Employee Recognition and Award Programs -- One of the most important areas an organization can

expand is its employee recognition and awards program. The purpose of an employee recognition and

award program is to say thank you, well done; we value you as an employee. The purpose differs from

the goals and objectives and other aspects of the total compensation theory. Salary is the payment for

doing the job; benefits are designed to protect an employee’s well being; short and long-term incentives

directly reward the achievement of specific performers.

Open Communication -- In a recent survey on retention, the number one reason for leaving an

organization or a job was for a “better” job. The question was then addressed by families in the work

institute – what makes a “better” job? The number one reason included open communications.

Being listened to and heard by others is a sign of being respected and valued. Today’s employees want a

choice – to state problems, share ideas, and make suggestions. While on-site childcare and other similar

programs are important to employees, most employees want to be respected and listened to. What can

organizations do to create strategies to offer a voice to its employees as a key retention/morale strategy?

Consider the following options:

Hold regular meetings. Keep staff informed

Work side-by-side with employees. “Walk a mile in my shoes” teaches true compassion for issues

faced daily by employees.

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Listen to your employees (suggestion systems, employee task force meetings, employee newsletter,

and employee committees).

Supervisory Training -- More often than not, those who are selected for supervisory positions will not

receive the necessary training to be successful as a supervisor. Often employees are made supervisors

and expected to know exactly what to do and how to do it.

Interviewing Skills

Positive Employee Discipline

Teamwork

Leadership Skills

Performance Appraisals

Conflict Resolution

Timely Performance Appraisals -- Timely performance appraisals are imperative within any

organization. In most all organizations we work with, performance appraisals are usually months behind

causing low employee morale and employee frustration. If conducted properly, the performance appraisal

can offer several benefits to the employee and employer including:

Supporting documentation and practices for defending against discrimination claims.

More satisfied and motivated employees.

More productive and committed employees.

Enhanced employee/employer relations.

Employee Benefits -- Benefit tools are very valuable when it comes to employee retention and morale.

Offering competitive or enhanced benefits is critical in recruiting and maintaining employees.

Employee Benefit Statements

What Employees Need and Want from Their Employer

Determine if you are meeting your employees’ needs. The following employee “wants and needs” have

been developed from SESCO’s 50 years of conducting employee and management satisfaction surveys.

Using these 10 basic “truths,” benchmark your organization and determine if you are meeting your

employees’ expectations:

1. EMPLOYEES WANT to do interesting, challenging work in which they can assume some

responsibility. Employees welcome work that is challenging and want the chance to think for

themselves and contribute new ideas. If employees do not perform work that is challenging and

motivating, they are forced to focus job satisfaction on compensation – more money and costly

benefits. This results in more wage and benefit demands and turnover. Spiraling wage adjustments

over the past several years have only motivated working people to look for their next wage increase.

Benefits, which now cost employers approximately 40 percent of their annual payroll, do not

motivate employees.

2. EMPLOYEES WANT recognition for excellent job performance. Verbal and tangible

recognition are equally important as pay increases. Recognition from management makes an

employee feel important and appreciated. These basic self-esteem needs, when consistently

provided by management and supervision, are some of the most powerful, intrinsic job motivators.

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Progressive management teams use Supervisor and Employee Opinion Survey Programs to satisfy

employees’ need for recognition and participation.

3. EMPLOYEES WANT to work with managers and supervisors who treat them with respect. Employees, supervisors and managers bring to the job a consistent need to be treated fairly,

consistently, and with respect. They desire employee communications that are two-way, not one-

way, and free of unrealistic demands and promises.

4. EMPLOYEES WANT the chance to develop new job skills. Employees want the opportunity to

advance and grow into more skillful people so they can move into more responsible, challenging and

financially more rewarding jobs. The more employees are qualified to do, the more they are

motivated. The less they are qualified to do, the less they are motivated.

5. EMPLOYEES WANT to work with managers who listen and appreciate their ideas on how a

job can be done better, more productively or more safely. Employees want to have the

opportunity of sharing their opinion on how their company can be a better place to work. For

many obvious and not so obvious reasons, employees don’t totally level with members of top

management about concerns of their jobs. It is hard to look a supervisor in the eye and say, “This is

wrong,” or “This is unfair and I think you should do this to correct the situation.” Employees seem to

hedge just a bit and don’t totally reveal their innermost concerns to their employers.

6. EMPLOYEES WANT a chance to think for themselves rather than just carry out rigid

instructions. Today’s employees are more intelligent and better educated than any previous period

in our economy’s history. Employers that implement employee involvement programs, employee

focus groups, and management-supported employee suggestion systems have benefited greatly by

meeting this on-the-job need of working people.

7. EMPLOYEES WANT to see or know the “end results” of their work. Employees want to know

how his/her job will contribute to achieving the organization’s mission, vision, and values. The need

for job enrichment is not a one-time proposition, but a continuous management challenge – an

ongoing journey.

8. EMPLOYEES WANT to work with managers and supervisors that are dedicated and ethical. We all wish to work with a manager or supervisor that is an effective leader. Employees want to be

loyal and supportive of their managers and supervisors. They want to work with ethical managers that

believe there is no right way to do a wrong thing.

9. EMPLOYEES WANT to know what is going on. Employees want to know how well the

organization is doing and the problems and challenges facing their employer. Only in this way

can employees and their families decide whether or not to go in debt for a new home, a new vehicle

or to borrow money for other family needs.

10. EMPLOYEES WANT to feel good about working for their employer. They want to have pride

in their contribution to the company’s objectives. Employees want to feel proud about where they

work.

Over 75 years ago Elbert Hubbard, a pro-employer and pro-employee author wrote these suggestions:

“If you work for a man, in heaven's name, work for him. If he pays you wages that supply

your bread and butter, work for him, speak well of him, think well of him, stand by him, and

stand by the institution he represents. I think if I worked for a man, I would work for him. I

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would not work for him a part of his time, but all of his time. I would give undivided service

or none. If put to a pinch, an ounce of loyalty is worth a pound of cleverness. If you must

vilify, condemn and eternally disparage, why, resign your position and when you are outside,

damn to your heart's content. But, I pray you, so long as you are a part of the institution, do

not condemn it. Not that you will injure the institution – not that – but, when you disparage

the concern of which you are a part, you disparage yourself.”

The Top Ten On-the-Job Needs

In today’s labor market a “wait and see” approach will not work when it comes to retaining your

employees. Based on SESCO’s survey of 165,000 employees and supervisors, we have identified ten

employee needs that are critical to the success of any organization:

1. To do interesting work. Cross-train your employees. This will increase their job skills and make

work more challenging.

2. Recognition. Oral and tangible recognition is often more important than pay increases. Remember

to say thank you for a job well done. Other reward programs include length of service awards,

customer service awards, and spot awards.

3. Respect from management. Training your managers in key management skills will increase the

effectiveness and employee relation skills of your management team.

4. Skill development. An organization should consider mentoring, skills training, or an education

reimbursement program.

5. To have input. Employees want a say in how things are done and an opportunity to express their

ideas to management. It’s more important than ever that management work as a team with the

employees.

6. Flexibility. As we experience changing demographics in the workplace, it is important that

organizations rethink their traditional policies. Remember to focus on results and not necessarily

time in the office.

7. To see “end results” of their work. Help employees understand that their job is important to the

organization and that they do contribute to the organization’s overall success. Consider

implementing a Management by Objectives program.

8. To be informed. Employees want to know current challenges and successes for the organization.

Consider implementing 50/50 meetings – top management meets with employees and allows them

to speak 50 percent of the time about their concerns and then management talks 50 percent of the

time addressing these concerns, and providing other information about the organization.

9. A fair compensation system. Employees need to understand their job duties and how they will be

rewarded.

10. To feel good about working for their employer. Share successes with employees, celebrate good

times, and respect each individual for their contribution.

How many of the above needs do you meet for your employees? We challenge you to implement at least

one of the above suggestions and see the results!

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Effective Ways of Destroying Employee Morale

Some companies have motivated employees that help the organization grow by working hard and cutting

out efficiencies. Other companies have poorly motivated employees who waste time, work slowly and

have a hard time getting to work. Many managers might assume that this lack of motivation is due to the

actions of the employees but it might be due to the organization's compensation design and employment

structure.

If you are an employer who couldn't care less about employee motivation there are a number of ways you

can really destroy or hamper any small hope of motivation. Perhaps you want your workplace to resemble

something more like a prison than a business in the 21st Century. In this case you will find these reverse

tips useful.

1.) Don't Pay Market Rates: Nothing destroys motivation worse then paying employees under market

wages. If you help them feel like they are respected and make it difficult for them to pay their bills

then there is a good chance they will leave your business. The added bonus is that your turn-over

rate will go through the roof.

2.) Play Favorites: Treat people differently. If you like them promote them, hang out with them and

always take their side. You can even go so far as making other people do their work and then give

your friends the credit.

3.) Cronyism: Don't bother to respect people's opinions. If you can make them feel as though they are

ignorant and don't know anything they will fall in line quickly. Simply having "yes men" around

will surely increase your ego.

4.) Don't Bother to Say "Thank You": Assume that your employees owe their life to the company.

Don't bother to say thank you for the small favors and complements your employees give you. It is

much better to be jerk and demand compliance. After a while your employees might actually hate

their jobs.

5.) Punish Innovation: When an employee comes to you with an idea for doing their job better it is

much easier to ignore them and send them back to work. If they continue in persisting that they

have a more efficient way to do business go ahead and fire them. Who needs someone who

questions authority anyway?

"The whole idea of motivation is a trap. Forget motivation. Just do it. Exercise, lose weight, test your blood sugar, or whatever.

Do it without motivation. And then, guess what? After you start doing the thing, that's when the motivation comes and makes it easy for you to keep on doing it." -- John Maxwell

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Characteristics of a Superior Leader

We look for some special qualities in our leaders. One recent study of American managers has found that

the attributes listed below account for most of the qualities that we admire in our superiors at work.

Please review the list below, then place a check () beside seven (7) traits or characteristics that you look

for (or admire most) in a leader, someone you would follow.

Ambitious

(hardworking, aspiring)

Honest

(truthful, has integrity, trustworthy, has

character)

Broad-minded

(open-minded, flexible, receptive)

Imaginative

(creative, innovative, curious)

Caring

(sensitive, appreciative, concerned,

respectful, loving)

Independent

(self-reliant, self-sufficient, self-confident)

Competent

(capable, productive, effective, efficient,

thorough)

Inspiring

(uplifting, enthusiastic, energetic, humorous,

cheerful, positive about future)

Cooperative

(friendly, team-player, available,

responsive)

Intelligent

(bright, thoughtful, intellectual, reflective,

logical)

Courageous

(daring, stands up for own beliefs)

Loyal

(obedient, dutiful, respectful, committed to

company)

Dependable

(reliable, conscientious, responsible)

Mature

(experienced, wise, has depth)

Determined

(hard working, persistent, purposeful,

steadfast)

Self-Controlled

(restrained, self-disciplined)

Fair-minded

(objective, forgiving, willing to pardon

others, consistent)

Straightforward

(direct, candid, forthright)

Forward-looking

(visionary, foresighted, concerned about

the future, sense of direction)

Supportive

(understanding, helpful)

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Performance Management Practically everyone complains about managing performance. Employees dislike performance appraisals

because they feel powerless in the process. They also feel like they are getting a “report card” which may

be based on arbitrary, confusing, and biased factors such as race, gender, and issues out of their control.

Supervisors dislike performance appraisals because they know that they may be forced to make decisions

about an employee’s performance, and then, after communicating sometimes upsetting news to the

employee, they must face him or her every day thereafter.

So why bother with performance management if neither the employee nor the supervisor likes the

process?

Performance management establishes a method of managing work groups that allows

supervisors/managers to set clear expectations with measurable standards with all employees regarding

their job responsibilities. It also supports and provides on-going monitoring, coaching, and feedback to

employees regarding their performance. Formal performance evaluations are based on the extent to

which the employee meets the specified expectations. Managers use the results of the process to make

decisions regarding selection, placement, training, compensation, and promotion.

Who is responsible for managing performance?

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17

Why Manage Performance?

As a team, list the reasons and purposes for managing performance.

FOLLOWER (EMPLOYEE) LEADER (EMPLOYER)

1. 1.

2. 2.

3. 3.

4. 4.

5. 5.

6. 6.

7. 7.

8. 8.

9. 9.

10. 10.

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Purpose of Performance Management

Performance management is the process used to establish standards of performance for each job and

evaluating that performance against the expectations. The process involves planning, developing, and

evaluating specific job-related performance. The final outcome of the performance management process

is a formal evaluation of the employee’s performance.

There are at least four (4) important purposes for performance appraisals:

1. To recognize past performance and to improve future performance -- A performance appraisal

can be used as a time for praise and a time for plans for improvement. This process allows the

employee and the supervisor to analyze past performance and set goals for desired levels of future

performance.

2. To support a fair and equitable compensation system -- Well-managed organizations tie

compensation directly to performance. An accurate performance appraisal system allows the

performance to be measured against goals to ensure fair compensation.

3. To provide frank and constructive feedback to employees -- Employees want to know how they

have done in the past and how they are doing now. They want coaching on ways to improve for

future performance.

4. Create a record of past performance -- The appraisal process should create a written record of

performance problems. Written performance appraisals provide the company with a legitimate

basis for making personnel decisions. If an employee is fired, effective performance appraisals are

often the most persuasive proof that an employee was justifiably terminated for poor performance.

Benefits of an Effective Performance Management System

Benefits to the Follower

If conducted properly, a performance management system can offer several benefits to the employee

including:

Clearly defined and understood goals and expectations of performance.

The importance of the employee’s contribution to the success of the department and company.

The understanding of how performance impacts compensation.

Clear understanding of how to improve.

Clear understanding of current performance (whether good or needing improvement).

General idea of “how am I doing?”

Understanding of consequences of poor performance (i.e., discipline, termination).

Confidence and trust in leader.

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19

Benefits to the Leader

In addition to offering several benefits to the employee, an effective performance management system

offers benefits to the employer as well including:

Supporting documentation and practices for defending against discrimination claims.

Satisfied and motivated employees.

More productive and committed employees.

Enhanced employee/employer relations.

With these benefits in mind, it is obvious that performance management can be a win/win situation if

properly implemented and followed.

Keys To Successful Performance

To positively impact the performance of your work group and begin to evaluate an employee’s

performance, the employee must understand what the job is, how it fits into the organization, and what

their responsibilities are. Additionally, the supervisor must do two things:

1. Assume responsibility for the performance of their work group, and

2. Set and communicate standards that are challenging, but reachable; and then monitor your

employee’s performance against these standards.

Keys that will improve the performance appraisal process include:

1. Describing the job and its importance to the organization – Explain the key responsibilities of the

job and how the accomplishment of these responsibilities impacts the overall organization. Help your

employee see the big picture and not just a small part of the picture. Explain how their results impact

the success of the company.

2. Establishing clear performance expectations – Next, establish performance expectations. These

expectations often come in terms of standards for the job. There are a variety of standards including

both tangible and intangible standards. Tangible standards are those that are clear, concrete, specific,

and measurable such as the number of items produced, shipped, received, deadlines, project

completion dates, etc. Intangible standards are those that relate specifically to human characteristics

such as attitude, morale, ethics, and cooperation.

Most people want to do their jobs well. It’s hard to do unless your employees have a clear

understanding of what is expected on the job. A standard or expectation should be specific and clear

enough to let the employee know what is expected, but should also allow the employee room to look

for new and improved ways of doing things.

To set clear expectations, you should review:

Job descriptions

Organizational goals

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20

Departmental goals

Past performance

3. Communicating Expectations to Employees – On the job, there is a level of performance that is

expected. That level of performance can change at any time. The older well valued employees may

need expectations restated. Or perhaps there is a new team member joining the team. So what actually

needs to be conveyed to assure understanding?

Managers or supervisors must take these steps to clearly communicate performance expectations to

their subordinates:

Why the task must be completed

When the work is to be completed.

How rigid the deadline is

How the finished work will be measured or evaluated

How important the task is in relation to other work being done

How the task fits into the big picture of the organization

As a leader, it is important to take the time with the employee to ensure all six steps have been

completed. Clearly conveying expectations is absolutely necessary when it comes to managing and

leading a team. After you have conveyed the expectation, be sure to ask questions. This will ensure

that both you, as the manager/supervisor, and the employee are both on the same page. After the

expectations have been communicated, solicit feedback from the employee and develop a tracking

and follow-up plan.

4. Identifying the skills and resources required to successfully get the job done – Discuss with your

employee the skills and resources required for them to successfully accomplish their job. If your

employee is experienced, ask them what they think will be needed to get their job done. Make sure

there is understanding and commitment from the employee on these key areas.

5. Setting priorities – As the supervisor, you have the responsibility of making sure that all tasks get

done. If your employees aren’t sure what tasks are more important than others, key objectives may

not get accomplished. Work with your employees to list the major tasks and activities and then rank

them in terms of their importance. Be sure to notify your employees if priorities change due to

special projects or organizational goals.

6. Review and check for understanding and commitment – It is critical to both your success and that

of your employee to make sure that you understand each other. To accomplish this, ask your

employee to restate the standards and review the priorities as discussed during the meeting. Listen

effectively to hear and understand what the employee says.

Good performance planning requires more than simply telling an employee: “This is what I expect from

you.” It takes thought, planning and commitment from both you and the employee. An effective way of

developing the goals and expectations is to hold a planning meeting between you and your employee.

This is basically a planning meeting for performance and not an evaluation session. There are four (4)

steps in this activity.

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Barriers to Effective Performance Measurements

Many times supervisors and managers feel that measurements of performance cannot be established for a

job. Some of the barriers to measurement include:

1. Think the job cannot be measured

2. Think measurements are hard to work with

3. Think of measurement as punishment

4. Think there is not enough time to measure

5. Who cares

6. Employees don’t like – it upsets them

7. It may make me look bad as a manager

Types of Measurement

1. Quality ─ Does it meet quality standards?

2. Quantity ─ Did we produce number required?

3. Timelines ─ Did it get done within time frame?

4. Cost ─ Was it within cost?

5. Improvement ─ Was improvement made?

6. Goal achievement ─ Was the goal met?

Qualities of Good Measurement

1. Understandable – Everyone understands where we are headed

2. Specific – It is focused on results

3. Helpful – It will promote growth

4. Useful – It will help make things better

5. Achievable – It gives a sense of success

Starting to Set Personal Goals

SMART Goals:

A useful way of making goals more powerful is to use the SMART mnemonic. While there are plenty of

variants, SMART usually stands for:

Specific

Measurable

Accountable

Realistic

Time-bound

For example, instead of having “to increase sales by 25 percent” as a goal, it is more powerful to say “To

have increased my sales by 25% at the end of the first quarter.” Obviously, this will only be attainable if a

lot of preparation has been completed beforehand!

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State each goal as a positive statement: Express your goals positively - 'Execute this technique

well' is a much better goal than 'Don't make this stupid mistake.'

Be precise: Set a precise goal, putting in dates, times and amounts so that you can measure

achievement. If you do this, you will know exactly when you have achieved the goal, and can

take complete satisfaction from having achieved it.

Set priorities: When you have several goals, give each a priority. This helps you to avoid feeling

overwhelmed by too many goals, and helps to direct your attention to the most important ones.

Write goals down: This crystallizes them and gives them more force.

Keep operational goals small: Keep the low-level goals you are working towards small and

achievable. If a goal is too large, then it can seem that you are not making progress towards it.

Keeping goals small and incremental gives more opportunities for reward. Derive today's goals

from larger ones.

Set performance goals, not outcome goals: You should take care to set goals over which you

have as much control as possible. There is nothing more dispiriting than failing to achieve a

personal goal for reasons beyond your control. In business, these could be bad business

environments or unexpected effects of government policy. If you base your goals on personal

performance, then you can keep control over the achievement of your goals and draw satisfaction

from them.

Set realistic goals: It is important to set goals that you can achieve. All sorts of people

(employers, parents, media, society) can set unrealistic goals for you. Alternatively you may set

goals that are too high, because you may not appreciate either the obstacles in the way, or

understand quite how much skill you need to develop to achieve a particular level of

performance.

Staying on Course

Once you have decided your first set of plans, keep the processes going by reviewing and updating your

to-do list on a daily basis. Periodically review the longer term plans, and modify them to reflect your

changing priorities and experience.

Achieving Goals

When you have achieved a goal, take the time to enjoy the satisfaction of having done so. Absorb the

implications of the goal achievement, and observe the progress you have made towards other goals. If the

goal was a significant one, reward yourself appropriately.

With the experience of having achieved this goal, review the rest of your goal plans:

If you achieved the goal too easily, make your next goals harder

If the goal took a dispiriting length of time to achieve, make the next goals a little easier

If you learned something that would lead you to change other goals, do so

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If you noticed a deficit in your skills despite achieving the goal, decide whether to set goals to fix

this.

Failure to meet goals does not matter much, as long as you learn from it. Feed lessons learned back into

your goal setting program.

Remember too that your goals will change as you change. Adjust them regularly to reflect growth in your

knowledge and experience, and if goals do not hold any attraction any longer, then let them go.

What is Constructive Feedback?

Constructive Feedback is responding to an employee’s performance through positive comments. Offer

specific suggestions for improvement and give the person an opportunity to respond to these suggestions.

Giving Constructive Feedback

Key Actions

1. State the constructive purpose of your feedback.

Indicate what you would like to cover and why it’s important

2. Describe specifically what you have observed.

Describe what you have seen – not what someone else has told you. This allows you to give very

specific examples of the behavior you wish to discuss.

3. Describe your reactions.

Tell your employee how you felt about their behavior, or describe the consequences of their

behavior to them and others.

4. Give the other person an opportunity to respond.

Getting the other person’s views creates an opportunity to check for any misunderstandings or

misinterpretations. A way to do this is to simply ask – What is your view of the situation?

5. Offer specific suggestions.

If your feedback to your employee is made up of only negative comments, then the feedback is

not constructive – it is destructive. Make sure that you offer suggestions that show your intent is

to help the employee improve their behavior or performance. Do this by providing practical,

specific suggestions on how they can improve or change their behavior.

6. Summarize and express your support.

You can avoid misunderstandings and misinterpretations by summarizing what was covered and

agreed upon by the supervisor and the employee. Do this by reviewing the major points you

discussed and stress your confidence in their ability to improve.

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Top Ten Reasons Performance Appraisals Can Fail

1. Manager lacks information concerning an employee’s actual performance.

2. Standards used to evaluate the employee’s performance are unclear.

3. Manager does not take the appraisal seriously.

4. Manager is not prepared for the appraisal review with the employee.

5. Manager is not honest or sincere during the evaluation.

6. Manage lacks feedback skills.

7. Employee does not receive ongoing, continuous performance feedback.

8. Insufficient resources are provided to reward performance.

9. There is ineffective discussion of employee development.

10. Manager uses unclear/ambiguous language in the evaluation process.

Source: Managing Human Resources, Sherman, Bohlander, Snell

Supervisor's Checklist for a Performance Appraisal Interview

Probably the most crucial part of the entire appraisal process is the interview with the employee in which

the appraisal is discussed. If handled well, the interview can lead to better understanding between

employee and supervisor. Ideally, any problem will be identified and the employee will come to

understand what is required in order to improve performance. If the interview is not conducted properly,

the entire appraisal will have little value. In fact, the employee may feel resentment rather than a desire to

improve. If you keep the following points in mind, you will increase the likelihood that the interview will

result in meaningful communication.

DO’S:

Preparation:

Review performance plans and accomplishments.

Note areas in which goals have not been met.

Complete appraisal form.

Prepare ideas for further development.

Timing:

Give the employee advance notice of the time of the interview.

Schedule enough time for a meaningful exchange to take place.

Location:

Arrange for a quiet location.

Be sure that you have privacy and avoid interruptions.

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Conducting The Interview:

Begin with a few minutes of casual conversation to help relax the employee.

Proceed to discuss all aspects of the job; go over each accountability separately. Although you

must point out both strengths and weaknesses, it will probably be more effective to discuss

positive aspects of performance first.

Try to avoid appraisals that are completely negative.

Focus on performances rather than personality.

Be constructive, rather than destructive. If there are weaknesses, point them out, but emphasize

what can be done to rectify the situation.

Focus on ONE key area of responsibility where improvement is mutually agreed to be desirable.

Establish a Development Plan with the assistance of the employee to improve this area of

responsibility.

Welcome any questions or complaints that the employee may have.

Summary:

Briefly review the important points of the appraisal.

Carefully restate the details of any proposed sources of action that you have recommended.

Be sure that the employee has had sufficient opportunity to say everything that he/she intended.

At the end of the interview, allow the employee to read the written appraisal and fill out the employee

comments section.

The form must be signed by the employee to verify that he/she has read it.

Follow-Up:

Periodically check the employee’s activities to determine whether or not goals discussed at the

interview are being obtained.

Offer assistance in achieving objectives.

Performance Evaluation Tips For Supervisors

Be honest and fair in evaluating all employees. Be certain that you as the supervisor have reviewed

all of your employees in an objective and consistent manner as individuals and relative to other

employees in the group. The purpose of performance evaluations is to take a realistic snapshot of the

employee's performance. Don't say the employee is improving if (s)he is not performing well.

Be consistent in your approach. Don't create a situation where it appears that you create excuses for

one employee while holding another employee accountable. Define your criteria for each level of

ranking and use the same criteria for every employee. Don't set separate criteria for certain

employees.

Give your comments. A ranking or number used to rank an employee's performance is useless

without a written comment. Comments are required for any ranking that is less than "3 or meets

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expectations" and also for the highest ranking of "5 or exceeds expectations." Comments may confirm

achievements or be constructive depending on the nature of the ranking.

Make your comments consistent with the rankings. Don't give someone a "meets expectations"

ranking if your comment describes a substandard performance.

Be realistic. Don't inflate ratings. Inflation of ratings only inflates an employee's expectations.

Rate the employee's performance, not the employee's "attitude." Keep your comments job related

and based on the employee's ability to perform his/her job. Avoid phrases like "bad attitude," "he's

not a team player," and other subjective type comments. Explain the behavior that is a result of the

"attitude."

Set goals with the employee. Don't just criticize a deficient performer; set goals for follow up and for

improvement or development. Work together to create a plan of action to help the employee in

deficient areas and to establish goals for the coming year. Set a follow up period and be sure to

reevaluate the employee at the appropriate time.

A performance evaluation should motivate an employee to want to improve. The employee

should feel excited about the challenges and his/her ability to meet them. If employees hear only

about their failures and weaknesses, they'll start to believe they can't succeed. If employees get

support and encouragement from their supervisor, they'll gain the desire and confidence to keep

trying. When the supervisors' suggestions for improvement bring results – and recognition –

employees are even more likely to listen to future suggestions.

There should be no surprises. The evaluation should be a review of the past year's performance.

Through previous counseling and other communications, the employee should be aware of any

concerns you might have about their job performance. The annual evaluation should not be the first

time the employee learns of your concerns.

One tool that may be used is to ask the employee to review his or her own performance and

expectations for the future by preparing a self-appraisal. They may complete the same evaluation

form that the supervisor uses or may draft a memo or list reviewing performance strengths and

weaknesses and future goals. Having the employee go through the same exercise may make it easier

for him or her to understand the value of the evaluation process.

Common Appraisal Errors of Performance Appraisals

1. Gut feeling (subjectiveness)

2. Lack of follow-up

3. Improper preparation; poor documentation

4. Biases:

Similar to me Positive leniency – want to give everyone high scores

Negative leniency – want to give everyone low scores

Halo effect – the employee is a "saint" so must have high scores

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27

Attribution – tending to see poor performance more within control of the individual and superior

performance as more of an influence of external factors

Stereotyping Contrast effect – contrasting one employee's accomplishments against another

Unfair comparison – comparing one employee against another

First impression

Central tendency (forced bell curve) – expecting in any group that there will be some poor

employees and some great employees

5. Recency effect: over – emphasis on recent performance

6. Inadequately defined and/or misunderstood standards/goals

7. Lacking truth

8. Poor interviewer (poor environment, poor use of time, domineering, poor listener, etc.)

9. Conducting an "annual" review (as opposed to the ongoing review)

10. Negative approach – catching them doing something wrong (as opposed to the One Minute Manager

Approach of catching them doing something right)

Handling Employee Behaviors

If the employee becomes defensive or makes excuses:

­ Listen to what the employee has to say and paraphrase back. Remain neutral. Maintain eye-

contact.

­ Don't solve the problem.

­ Ask for specifics with open-ended questions.

­ Try to determine the cause:

"Tell me more." "How did you reach that conclusion?"

Ask how the employee will resolve the problem.

If the employee becomes angry:

­ Stay calm and centered. Maintain eye-contact.

­ Listen to what the employee has to say and paraphrase back.

­ Let the employee "run down" for as long as s/he needs until the employee can listen to you.

­ Avoid arguments.

­ Bring discussion and focus back to performance and standards.

­ Say the employee's name, and ask open-ended questions.

If the employee is unresponsive or withdraws:

­ Be patient and friendly.

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28

­ Show concern.

­ Stay silent, and wait for the employee to say something.

­ Ask open-ended questions.

­ Note that the employee is unresponsive.

­ Encourage the employee that you want to hear his or her input, and this input is important to you.

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SESCO Complete Human Resource Staff and Services for

MAHC Members

As a member of MAHC your organization receives the following services:

Free Telephone/E-mail Consultation – The SESCO staff is available to answer your human resource questions on a daily basis at no charge. Whether it be a federal or state employment compliance question such as wage and hour, FMLA, COBRA, INS, Equal Employment, etc., the SESCO staff stands ready to assist you. In addition, the staff assists in research, handling difficult people problems such as terminations, disciplinary actions, substance abuse or other day-to-day issues that arise. The only cost is the cost of long distance and, of course, e-mail is at no charge.

Handbook Review – For $150 the SESCO Staff will review and analyze your current employee handbook or policies to ensure compliance with federal and state employment regulations, as well as to ensure the employee handbook is effective as it is the cornerstone communications tool of any employer-employee relationship.

The SESCO Report – SESCO’s monthly newsletter is available to MAHC members online through MAHC’s or SESCO’s website.

Human Resource Compliance Manual – The SESCO staff has prepared a custom compliance manual for MAHC members and the industry. It is well over 200 pages and contains sample policies, forms and SESCO staff recommendations. It is a complete human resource management compliance guide and is an excellent reference manual for your HR and Management Team. Buy this manual at the special discount price of $99.00.

Member Service Agreement – Individual members can establish a service agreement with SESCO to provide ongoing professional services. The monthly agreement ranges from $100 to $200 per month which provides ongoing consulting services at no additional charge as well as onsite assessments as requested.

Discounted Consulting Services – The SESCO staff is available to provide consulting services as requested which include:

­ Management Development and Training

­ Online Management Training

­ Personnel Opinion Surveys

­ Compensation Administration

­ EEOC Charges

­ Personnel Forms

­ Online Recruitment Tools

­ Employee Handbooks

­ Affirmative Action Programs

­ Criteria-Based Job Descriptions

­ Performance Management Systems

­ Employee Benefit Statements

­ Screening and Hiring Systems

­ Employee Retention Systems

­ Team Development

­ Organizational Change/ Development

­ Strategic Planning

­ Labor Relations

(Please call for a full description of SESCO’s professional services or utilize the Fax Request Form on the backside of this brochure.)

P.O. Box 1848 Bristol, Tennessee 37621

(423) 764-4127 (423) 764-5869 (Fax)

web site: www.sescomgt.com e-mail: [email protected]

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P.O. Box 1848 Bristol, Tennessee 37621 (800) 764-4127 Fax: (423) 764-5869 Web site: www.sescomgt.com E-mail: [email protected]

Please FAX this form to: (423) 764-5869 Attention: Bill Ford

I would like to find out more about how SESCO’s systems and services can assist in managing my organization’s human resources.

Please send me information on the following SESCO service(s):

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P.O. Box 1848

Bristol, TN 37621

(423) 764-4127

Fax: (423) 764-5869

web site: www.sescomgt.com

e-mail: [email protected]