CONDUIT

Here’s more on the power employees have in building your brand…

In Eric Krell’s article in October edition of HR Magazine we see rising evidence that employees are powerful allies for the brand’s image. Krell makes the case that employees are both constituents and customers of the brand. They must connect with it; believe its underlying promise, own it, and commit to delivering it if the brand is to develop, resonate and gain value as a corporate asset.

Want evidence that employees are critical? Look at the side story on United Airline’s “Rising” campaign. Hostile workers—even those who are only marginally uncommitted—can doom the best marketing effort.  Also consider the impact employees have on brands that are not heavily advertised. Even in the absence of marketing rhetoric some brands grow in value—like Starbucks for example. 

In his report Krell carefully lays out the communication and operational components he believes must be addressed to ignite and sustain brand-building behavior. One element that seems to be missing (from this and other articles I have read on the subject) is the role employees can play in influencing on one another. The term social networking describes how individuals make decisions. How the behavior of peers can influence one another is critical. Peer influence has  more impact than messages delivered from distant senior management. Peer-peer recognition plays a vital role in building ambassadors for the brand and creating those very types of employee evangelists Krell deems as critical in the re-branding process.

One Secret to Double Digit Growth…

I had the pleasure of listening to Michael Treacy speak recently. The author of Double Digit Growth had some interesting comments about branding and the role HR plays in managing the talent supply chain for growth firms. 

In Treacy’s view, brands have become highly commoditized. The image of a brand is largely company driven through external advertising and internal mission and value statements. The meaning and perceived value of the brand, however, comes from personal experiences. 

Experiential interaction with the brand drives all dimensions of customer equity; share and frequency of spend, advocacy, price elasticity and insulation.  Positive brand experiences drive consumer loyalty. The impact on the bottom line: reduced costs of acquiring new customers and increases in the lifetime value of the ones you do have. That’s one economic consequence that helps growth companies outpace their peers.   

Looking at branding through the lenses of employee motivation, it is no wonder why progressive marketing executives are increasingly focused on the actions, behavior, and commitment of the firm’s employees. In our service based economy employee behavior—at that moment of truth where the brand is tested in the marketplace—that juncture where your brand’s ambassadors (your employees) intersect with your customer—is the most critical moment in any marketing mix.    

Tracey is also adamant that HR is underestimating their responsibility to a firm’s growth requirements. He says HR executives should acquire and develop talent at a rate that is higher than actually needed. Doing so firms can afford to be more selective, picking and choosing employees for advancement within the firm and divorcing itself more readily of those who under perform and do not buy into the firm’s value proposition.

Tracey also said that the U.S. economy is the only one in the world where both talent and capital are highly mobile. This he says ignites entrepreneurship and is forever increasing the number and nature of competitive forces a firm needs to overcome.

Unforeseen competitors, shifting market conditions, and a growing reliance on consumer equity to fuel growth are just some of the many reasons why HR executives are working more closely with their C-level colleagues to position employees (throughout the value chain) as the firm’s primary source of competitive advantage.   

HR departments and practitioners must add value

David Ulrich author of Human Resource Champions and The HR Value Proposition had two interesting comments in the Fall 2006 Edition of Higher Ed HR. 

On the issue of what differentiates effective HR from ineffective HR? Ulrich was quick to point out that HR departments and practitioners must add value. HR should not be worried about what they do and should focus more so on what they deliver. He also added that HR’s primary role is to ensure a flow of talent and that building an organization did not end with managing the talent funnel. The game plan must also focus on how all that talent works together. In simple speak: HR must build a level of teamwork across the ranks. 

While at the 10,000 foot level you could probably file this observation as a glaring statement of the obvious, however, the comments are also consistent with what we are hearing ourselves at Conduit. We are consistently hearing from HR executives being called upon by C-level colleagues in finance, operations, and marketing to improve employee commitment and competency throughout the value chain.

Why the intense focus? In our information and knowledge based economy people are the primary source of competitive advantage.  Financial executives are acutely mindful of the role intangibles play in asset valuation and no element of that formula has gotten more attention lately than human capital development. The analysis has to do with sustainability. If an organization is to be looked upon as one that will continue to thrive without exhausting its resources, then strategies that develop and ensure long-term access to an engaged, emotionally and intellectually invested labor pool is a critical analysis point for long-term investors.

I’ll talk more about how HR is helping marketing and operational executives meet their strategic goals in my next post. 

Go beyond maintaining a relationship—shape it instead.

Jack Welch says HR must also help organizations maintain their relationships with employee stakeholders. This quote brings to my mind the importance of personalized communication within reward and recognition programs. More and more we see smart companies employ a direct marketing mentality and avoid mass-messaging their employee audiences. These firms have learned how to converse with different employee groups effectively and as a result their messages are acted upon.

What do I mean? Following a segmented campaign formulated award propositions are generally geared to an employee’s relevant place within the organization.

Here is a simple framework to start with;

1. Show off your top performers. Give them the recognition they crave while using their stories to promote best practices and localized leadership across the organization.
2. Grow rising stars. Give them manageable goals and expand the hurdles as each is reached. This is the best way to gain momentum that leads to the type of reliable incremental growth you can build your business case on.
3. Teach those with identifiable performance gaps. Isolate where they are lacking and reward them for completing steps that will lead to success. Examples could include; becoming recertified in a particular product line, passing a refresher customer satisfaction training course, or submitting a business or territory plan.
4. Reach underperformers. These are the folks who showed promise once and for one reason or another have become disengaged and ineffective. Re-recruit these people through communication components that stress their importance to all stakeholders; the firm, its customers and their colleagues. Ask them to nominate others that they consider successful. You will be surprised how that small step can create a renewed awareness and help reverse a pessimistic mindset.   

Using database mobility mapping, messages are created, managed and delivered via the web. As employee attributes or business conditions change so can your message and reward scenarios.  If you want a much more relevant and self-sustaining way to capture the attention and guide the behaviors and attitudes of all your employees try this approach.

Jack Welch High on HR?

In my last post I said there was no killer app on the horizon and that innovation and not invention would ignite the next growth wave. Leave it to Jack Welch to do me one better.

In an interview published last month in The Telegraph, Mr. Welch says “HR should be every company’s killer app.” He also goes on to say that many HR executives have yet to earn a seat at the planning table equal to that of finance even though the importance of people as a production asset has never been greater.

How can they contribute more? According to Mr. Welch, HR should play a dual role by first, creating “effective mechanisms such as money, recognition and training to motivate and retain people.”  He goes on to say that HR must also help organizations maintain their relationships with employee stakeholders. 

I can’t help to comment here that this new thinking is coming from a man who perfected forced ranking to the delight of the investor community. While once popular management tools, these rather cold and impersonal methods of managing employee contribution have actually disenfranchised and alienated work forces.   This according to a recent article in Fortune Magazine that ‘tears up the Jack Welch playbook’.

How does Mr. Welch reconcile his new perspective? I'm perfectly prepared to change," says Welch. "Change is great."

Of course the increasingly strategic role of HR in a market society where people are almost always referred to as a ‘company’s most precious asset' is not new. But what is remarkable is the almost universal belief that HR has a chance (responsibility even) to be a major contributor in the modern economy. 

Mr. Welch’s comments are a less than subtle nudge to anyone in the Human Capital field that hasn’t taken the opportunity to seize the day to do so.