Some employees will act as if the company is their own even if they have no ownership interest. If they have work on their desk at the end of the day they routinely stay late and finish it without being asked. They go the extra mile because they want to; something inside is driving them. You can develop a corporate culture to motivate employees to act and think like owners even if they have no ownership interest. Companies with a culture of employee involvement and ownership mentality outperform the competition because the employees contribute ideas and information and move the company forward to success.
It is critical that the company’s leadership be committed to the belief that employees are a strategic advantage in attaining the goals of the business.
The first step in creating a culture of employee involvement and ownership is to identify the actual barriers to participation. Some effective tools are employee surveys, focus groups, interviews with managers and outside consultants who evaluate work processes. You can simply ask your employees two questions:
- Are you familiar with the company’s strategy?
- Do you know what you need to do in your position to move the company forward?
The next step is to begin treating the employees as owners with regular and continuous communication. Educate your employees about the company’s direction and goals and the progress toward those goals. Teach them what is important for success, how to identify problems and, most importantly, how to fix problems. Listen to their suggestions for achieving the goals and act on their suggestions; give them what they need to achieve the goals. Provide regular feedback and corrective actions to keep the company on course for success. Keep communications positive and respectful – act like you are having a discussion with an owner of the business. You can ask questions such as:
- What are we doing that moves the company forward?
- Is there anything we are not doing that we should be doing?
- Is there anything that needs more emphasis?
- Is there anything that we should stop doing?
- What is required from us from other departments in order for them accomplish what they need to do to move the company forward?
- How can we enlist the support from other departments to help us achieve our goals and objectives?
When all you do is present the strategy to the rest of the company, you do not ask the employees to think about the strategy from their perspective — what does it mean to their job? What does it mean to their department on a day-to-day basis? By asking each department to present what they had to contribute to move the company forward, each department and each individual has the opportunity to think about the company strategy in the terms of what they do on a regular basis. By allowing the departments to think on a more strategic level each department will become focused on the key activities of the organization and will streamline their activities as a result of this process.
Asking each department to make a presentation will force each group to think through clear objectives that could be presented so that others in the company would understand. This allows other department’s to better understand each other’s role in the company’s success and allows for more coordination.
Companies that provide employee’s access to relevant operational information leverage the knowledge and ability of their employees. Many managers still feel that information is power and that sharing it compromises that power. Sharing information is critical to fully leverage the corporate resources.
In addition, employee rewards must be aligned with business strategy and goals. Equity ownership plans are long-term incentives. Actual ownership is achieved through long term equity vehicles such as stock options, employee stock ownership plans (ESOPs) and stock matches to retirement plans. Phantom equity plans or private stock exchanges can be established to provide the same ownership effect for private companies.
A company must have short-term incentive programs that align the employee’s interest to immediate operating goals. It is critical to establish goals for corporate success and reward only when results are achieved. The compensation system must support the company’s business plan, strategy and goals. It must reinforce the culture of employee involvement and ownership mentality and it must reward employees when they contribute to the company’s success. For example, teamwork, open communication, progress toward goals and overall commitment should be rewarded.
The involvement and ownership culture creates an environment that includes employee awareness of corporate value, improved performance, improved communication, employee development and employee contributions to corporate objectives and goals. Do you think it is worth it?