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(originally published by Booz & Company)


It’s Not about the Money

Improving schedules was only part of the solution. Like many other large businesses, the company had fostered an “us versus them” attitude among the workers toward management, which made employees less than enthusiastic about pursuing the organization’s goals. This mentality was driven by management’s tendency to make changes at the factory after consulting only a small, hand-selected group of employees, leaving out the vast majority of shift workers. As a result, the survey revealed, a mere 26 percent of the shift workers felt that the management team cared about the employees — a full 13 percent below the norm in the databank created by our study — and just 19 percent believed the management team communicated well with employees. Fifty-two percent of employees said they did not feel like they were an essential part of the company.

Some of these results reflected workers’ perceptions and not reality. For example, as evidence of senior management taking them for granted, the workers offered the disparity in the amount of time spent on the job. They wondered why they were at the plant nights and weekends while senior managers were there only Monday through Friday, 9 a.m. to 5 p.m. The managers countered that, in fact, they worked at least 55 hours every week, but they were in their offices and not easily visible to people on the assembly lines. “It’s not a big deal,” one of the managers said. “The workers on the floor just don’t understand.”

Perhaps, but that attitude only exacerbated the sentiment that the front office didn’t care about the shop floor employees. A lack of communication was also to blame: Senior managers typically didn’t approach employees for their input about operations and factory changes or their thoughts about their jobs because they feared the worst — that they would be asked to tackle a complex, painful alteration of some time-worn procedure or be subject to a diatribe about working conditions. Moreover, scheduled monthly update meetings usually failed to address employee concerns. Although factory workers said they liked sitting down for a half hour, eating doughnuts, drinking coffee, and getting paid for it, they admitted that they would prefer to have managers show up at the assembly line more frequently at random times so they could witness the workers’ issues firsthand.

Before our employee study, management’s primary idea to boost morale was to add a new break room and repaint existing ones, but this wouldn’t have helped. Our survey found that 74 percent of employees felt that working conditions at this facility were good. After learning that the core of worker dissatisfaction was related to the growing gap between employees and their managers, the COO changed direction. He instituted a new communications strategy focused on providing information to employees that they felt was useful. For example, the agenda of the quarterly plant-wide update meeting was transformed. Instead of 60 minutes of spewing high-level numbers and showing charts that looked the same each session, the results were condensed so that there would be time to address concerns about work life and other critical employee issues. In addition, once every four weeks senior managers were required to work shifts similar to the people who report to them.

With the new schedules and more open communication, the employees were mollified. The vote to unionize was defeated by a large margin. Moreover, the manufacturing firm realized more than US$1.6 million in combined cost savings and new profit during this process, with $675,000 directly related to morale improvements, including lower training and recruiting expenses due to a decline in worker turnover and gains in productivity.

Deterioration of employee satisfaction is a slippery slope. Most companies make the mistake of thinking that throwing money at labor challenges is the only sure solution. In the short term, that may be true. But to implement a sustainable program with a continuing return on investment, something much more creative — born of listening closely to what the employees really want — is the only real option.

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  1. John Frehse, “Shift Worker Productivity Need Not Be an Oxymoron,” s+b Leading Ideas Online, 06/05/07: The causes of low productivity and why management teams lack the appropriate knowledge and skills to solve this problem.
  2. Timothy H. Monk and Simon Folkard, Making Shiftwork Tolerable (CRC Press, 1992): Examines the experiences of and problems encountered by shift workers.
  3. Tom Rankin, New Forms of Work Organization: The Challenge for North American Unions (University of Toronto Press, 1992): Details the changing world for unions, new compensation practices, and the difficult environment for shift workers in North America in the late 20th century.
  4. David Wainwright and Michael Calnan, Work Stress: The Making of a Modern Epidemic (Open University Press, 2002): Explores the unhealthy shift work environment and the psychology behind the epidemic of work stress among those with low-paying jobs.
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