No doubt about it. Truly successful organizations typically have happy people. Or put another way, to win in the marketplace you must first win in the workplace.
This is not about free lunches, foosball tables, and singing Kumbaya in the company parking lot. It’s about genuinely connecting with people’s heads, hearts, and hopes. Then, and only then, do people devote their full discretionary effort to their work.
Multiple studies show that best-in-class engagement—that is, the top 10% of engaged employees—will, on average, yield about 300% more innovation.
What else? They have much higher retention rates. They produce more sales. They have superior safety records. They have much lower burnout rates, lower absenteeism, and less turnover.
Still, employee engagement remains a widespread challenge. The Gallup organization reports that anemic engagement—just in the U.S.—costs business more than $400 billion a year.
But there are bright spots. And one of the brightest is St. Louis-based Barry-Wehmiller.
Founded in 1885, privately held Barry-Wehmiller is a global supplier of manufacturing technology and services.
With more than 11,000 employees worldwide, this company has invested years in developing—and practicing—a people-centric operating philosophy that pays huge dividends in performance.
CEO Bob Chapman sums it up succinctly: “Machinery can increase productivity in measurable increments, and new processes can create significant efficiencies. However, only people can stun you with quantum leaps. Only people can earn ten times what even they thought they could. Only people can exceed your wildest dreams, and only people can make you feel great at the end of the day. Everything we consider valuable in life and business begins and ends with people.”
Bob has captured this tried-and-true operating philosophy in his book Everybody Matters: The Extraordinary Power of Caring for Your People Like Family.
This is not just a feel-good story, although the story does feel good. It’s a road map for the leadership journey that can have lots of potholes and a few detours. As with any good map, this one can help you arrive safely at your desired destination.
Rodger Dean Duncan: A growing number of businesspeople are (finally) beginning to see the value of focusing on organizational culture. What’s your brief elevator speech encouraging such focus?
Chapman: From my perspective, we have had a crisis of leadership for decades as our business leaders have largely define success as money, power and position, rather than improving the lives of those they have the privilege to lead.
The facts are compelling: 88% of all people feel they work for an organization that does not care about them, and three out of four people are disengaged. We’ve learned that the person you report to at work is more important to your health than your primary care physician!
Our vision is that business could be a powerful force for good in the world if we developed leaders who have the skill and the courage to care for those in their span of care—with the goal of sending them home each day knowing that who they are and what they do matters. When people feel safe, cared for and valued at work, they treat their loved ones better than when they feel used for someone else’s success.
We see our “product” not as the capital equipment we build globally, but the people who build those machines. And having evolved over 15 years in our practices of Truly Human Leadership, we now see that 95% of the feedback from what our team members learn and experience at work impacts their personal lives—marriages, relationships with children, significant others, friends, neighbors. Our society has long enjoyed the benefits of the industrial revolution, which is economic growth. But what we need now is a ”human revolution” where the way we lead in businesses and our organizations is as important as the products and services we create!
In the military we teach officers that their highest responsibility is the men and women in their care. I’ve come to realize that we desperately need this same education in business as our experience is that we can create human and economic value in harmony.
Duncan: You refer to continuous improvement as “the gateway drug to engagement and fulfillment.” What does that mean, and what does it look like in actual practice?
Chapman: The ideas of the Toyota production system, or Lean, are powerful. Unfortunately, these ideas were embraced to reduce waste and improve profits.
Who is inspired by the reduction of waste? If those who studied the fundamentals of Lean had understood the human potential of this system, where rather than bosses telling people what to do because they knew more they instead thoughtfully engaged people and asked them how to eliminate waste and frustration, it can be far more powerful. Rather than “Lean,” it should have been named “Listen.”
One critical question we added to the Lean process was, at the end of an event, to ask the participants “How does this make you feel?” Due to that one simple question, grown men and women have come to tears saying, “People have always told us what to do. We get ten things right and never hear a word and then get one thing wrong and hear all kinds of complaints. Now people are asking me what I think and I’m able to contribute to making work processes better. Also, I go home feeling valued and it has improved how I treat my family!”
Continuous improvement is a powerful concept if we embrace it to value the ideas and contributions of our team members and to improve their work environment, rather than to improve profits. A key part of our Lean program is recognition and celebration. We people know we care and appreciate their effort to create a better future for their team members. Steve in our Green Bay operations says that his wife is talking to him more now because, as a result of how Lean improved his work experience, he is nicer to her!
Duncan: You note that emotional contagion is the unconscious transmission of actions or emotions from one person to another—and that people are “walking mood inductors,” continually influencing the judgments and behaviors of others. How can emotional contagion be deliberately used to advantage in the workplace?
Chapman: Our Truly Human Leadership culture is fostered by leaders who have the skills to care for those they have the privilege to lead. As it turns out, caring is contagious. When we showed we cared about those in our span of care, we found that they in turn began to care for others in the organization.
Washington University-St. Louis studied two of our largest companies and found within them a high degree of altruism, which is the willingness to do something for someone else without expecting anything in return. We realized that the natural tendency to care for others is often held back when people feel used for economic gain rather than feeling cared for. Partners at McKinsey, Harvard professors and many other thoughtful people have observed our culture and said things like, “I have never seen anything like this.” Author Simon Sinek said, “I am no longer a nutty idealist because if it exists it must be possible.”
Duncan: Rather than resort to employee layoffs and other trust-busting practices during the country’s economic downturn in 2008 and 2009, your company adopted a “shared sacrifice” approach to managing the business. What was the philosophy behind that approach, and how did it work out both short- and long-term?
Chapman: When the crisis hit we had recently adopted our values statement, the Guiding Principles of Leadership, with this overriding vision—”We measure success by the way we touch the lives of people.” I sat in a hotel room in Italy one night and thought “If we measure success by the way we touch the lives of people, then letting them go will hurt many families.” This stimulated my thinking toward “What would a caring family do if a member had an issue? They would all take a little pain so that no one would take a lot of pain.”
We implemented this idea of shared sacrifice with compassion and care and the reaction was exceptional. Our team members willingly gave up a month’s pay knowing they were helping their co-workers keep their jobs. In return they could take an extra month of vacation time when it was best for them. Many used the time to do special family events or volunteer work. Some also took the unpaid time off from others who could not afford to forgo a month of pay. These actions validated our culture of caring. We kept our talent and bounced back quickly from the downturn.
Duncan: And old saying suggests that “seeing is believing.” When it comes to organizational culture, you reverse that to “believing is seeing.” Give an example or two of how that can play out in the workplace.
Chapman: We were busy driving our vision of “measuring success by the way we touched people’s lives” deep into the organization. Often, our team members pointed out where we weren’t measuring up.
Ron, who had been with the company for 27 years, had just returned from three months of installing equipment in Puerto Rico. “I see the word ‘trust’ near the top of this document,” he said. “However, it seems like you trust me a lot more when you can’t see me than when I’m right here. While in Puerto Rico, I was an ambassador of the company, with an expense account and freedom to do my job. Now that I am back, when I walked into the plant Monday morning with a lady who works in accounting, she turned left to go into the office and I went straight ahead into the plant. Just like that, all my freedom just slipped away. It felt like someone had their thumb on me all the time. I had to punch in at a time clock when I walked in, when I left for lunch and when I got back, and when I left to go home. If the lady in accounting wanted to call home, she could just pick up the phone and call. I had to wait until I had a break. If I have a doctor’s appointment, I have to get my supervisor to sign off on my card and I get docked for the time. The accountant just goes to her appointment. I had to wait for the break bell to get a cup of coffee or even to use the bathroom. If you really believe in these Guiding Principles of Leadership, why would you trust me when I was in Puerto Rico and not trust me when I am here?”
When he finished, I said, “That’s just the way we’ve always done it in manufacturing, and no one has stopped to ask why.”
The very next day we removed the time clocks and break bells. Walking our talk has been critical to building trust and the culture we envisioned by showing our team members that our practices were aligned to our beliefs.
This column was first published by Forbes, where Dr. Duncan is a regular contributor.