Proven Human Resource Practices Work Everywhere
2004-01-01 email this article to a friend.
Business consultant Phil Gaetano has led HR for some of the world’s best performing companies. He is a recognized expert in maximizing return on human resource investment, to bring about increased productivity, quality and customer service. Gaetano and his family are relocating to Bozeman from New Canaan, Connecticut.
In this second half of a two-part interview, I picked Phil’s brain on some common and vexing questions we’ve all confronted.
RK: From your observation, what is most different about the Montana workplace? Can “what works” for large national companies be adapted to Montana’s wok culture and values?
GAETANO: Montana is a great and unique place to live, go to school, work or retire. But Montana’s business requirements for customer service, quality, productivity and value are like anywhere else, and its companies’ needs are similar to companies in other parts of the country. “What works” are the best practices used by top performing companies – the best of the best. These should then be streamlined and tailored for specific company needs. And then they can and will work for Montana companies. Business concepts and solutions are similar for companies, regardless of size. But processes vary widely based on size and resource availability, because companies require different implementation and integration. Actually, that’s what I’ve done quite successfully for the past four years, with many small companies around the country.
RK: How important is it for companies – small and large – to have a strategic plan, and how essential is professional assistance in developing that plan?
GAETANO: Somewhere along the way, strategic planning has gained the reputation for being complex and even intimidating. It’s neither. It can be very simple for most businesses and when done properly, it provides huge benefits to business leaders. PS is the foundation for direction, organization, managing and utilizing resources in a company. It is a critical component to success, regardless of the type or size of a business. However, the secret of success is in making the SP a living charter for everyone in the organization. You do this by linking the plan to everyone’s interests and activities, and by aligning subsequent plans with the SP. A professional with experience in companies known for effective strategic planning is worth the cost, can save a company time and avoid errors in misdirection. This person not only guides development of the strategic plan, but helps link it to business planning, human resource planning, and even specific operating plans.
RK: What do you feel is the most common mistake employers make in the area of worker incentives and motivation? Is there a tried and true principle to follow here?
GAETANO: “Line of sight”, which is the clarity by which employees see how their results lead to their rewards, is critically important with incentives. Also, it’s crucial to understand what is meaningful to people in recognition and rewards. Too many managers incorrectly assume that their subordinates want the same incentives as they do. Incentives should reward achievements of the employee, but only when these achievements benefit the company. On motivation, I think managers perceive that money motivates more than it actually does. Study after study proves that money ranks below several other motivating factors, including: sense of achievement, being appreciated, working for a good boss, good working conditions and working toward a common goal.
RK: Most companies have mixed feelings about bringing in outside trainers and coaches. Training often results in no observable improvement. Have you any advice in this area?
GAETANO: Training should be measured like any other business asset. If a trainer can’t demonstrate an improvement in your business, don’t use them. I have simple advice for companies that are not Fortune 500: use outside trainers. Training needs in a company are diverse, and the cost required to have a full time staff of trainers that can meet all of your company’s training requirements would be exorbitant. The professional training industry is highly competitive, and trainers are forced to stay current with leading edge techniques. Find someone you trust and try them out. Ask them to demonstrate how their training will pay off to your bottom line.
RK: Is company loyalty still an operative word among modern employees, or a dead concept?
GAETANO: I think loyalty goes both ways in companies today. I once worked for a very insightful Chairman/CEO of a Fortune 500 company who, incidentally, was twice voted CEO of the Year by Industry Week Magazine. He used to say that the best employees will get the most opportunities outside of the company, and it was leadership’s responsibility to keep them challenged and motivated to stay. He believed that you had to work to earn the loyalty of top talent, but they were worth the extra effort. I think smart employees in the new economy are learning to manage themselves and their careers. They know that job security is rare. Loyalty can still be fostered, but it means that companies have to invest in their employees’ skills and futures, rather than just hand them a paycheck and a 401K plan.
RK: Is outsourcing of human resource functions more appropriate to large companies or small? How does one know when outsourcing is needed?
GAETANO: It definitely makes sense with small and mid-sized companies, and it’s becoming increasingly popular with large companies. Outsourcing allows company management to focus their energies and resources on their core business and mission, while leaving HR services to HR experts. My rules in determining outsourcing are that if someone can make your life easier, consider outsourcing; if someone can do it faster, better and cheaper than you can, definitely outsource.