Managing The New Generation Of Employees

A strategic approach can help retain top employees.

lineup shortIt’s often said that you just can’t find loyal specialty gases and welding employees anymore. I agree. You can’t find them—you have to build them. That’s just one of the ways that the new generation of employees is different from yesteryear’s. We are no longer in an era where all a manager has to do is hire good people and pay them a fair (or almost fair) wage to keep them working at the company. A good manager must do that, plus provide a blend of benefits and company culture that work together to do what essentially boils down to keeping people happy.

Good examples of companies that have been successful at this can be found in Levering and Moskowitz’s book The 100 Best Companies to Work for in America. These companies have succeeded not only because they have high commitments to the products and services they provide, but because of the employee-friendly workplaces they provide. The key attributes these companies share have less to do with paying high salaries than they do with demonstrating that employees are a highly valued asset. Some examples include:

  • Reasonable commitments to job security
  • Facilities and policies that exceed the legal minimums
  • High sensitivity to work-family balance issues
  • High degree of employee autonomy
  • Open communication
  • A sense of ownership.

balancedsystemchartNot convinced? Here’s a telling statistic: A Robert Half International survey found that nearly two-thirds of Americans said they would be willing to reduce both their work hours and their compensation in exchange for more family or personal time. It’s clear that Americans’ priorities have changed, and managers who are progressive about meeting those needs will have a real advantage in the marketplace.

Adopt a Strategic Approach
Managing well today means managing strategically—taking the time and effort to make sure that each decision you make logically balances and supports the key objectives and operations of your company. The figure illustrates the many areas that managers must balance in order to keep employees happy and, most important, productive.

Unless a distributor strategically plans for these components to work together, they may actually get “out of balance” and work against the very benefits the distributor hopes to get from them. For example, the caliber of employees that any given distributor seeks to hire should match the overall management systems appropriate to hire and keep them. Sounds logical, but too often distributors are interested in getting and keeping the best employees without exploring what the industry requires to attract and keep them.

Consider for a moment the area of compensation. The best employees will always earn top dollar in any industry. Is your company able to attract them with its current pay system? In compensation terms, your company fits into one of the following categories: a leader (pays better than average), a competitor (pays about average) or a laggard (pays below average). You really do get what you pay for. If you are going to go after the high-caliber employee and pay a leadership wage, you also must recognize and plan for the appropriate training systems that will support the career paths that a high-caliber employee will expect. You must have well-developed measurement systems and open communication so that employees will know the progress they are making and thereby be motivated to continue working hard, and so on. Get the picture? Each area must support the others (think strategic).

By the way, I’m not suggesting that paying an above-average salary is the only way to achieve a balanced management system. You can accomplish a balanced system with a competitive or a laggard pay scale as well, but you’ll have to be creative to make them work together to keep employees happy. I know of one distributor who pays a laggard wage purposefully. Testing is used to identify intelligent but under-skilled employees and, essentially, “grow their own.” But they have invested heavily in education and training programs to support these employees, in addition to a strong incentive system and team environment to keep people motivated. Employees have a strong sense of purpose in the company and are given a lot of “ownership” in how they handle their own work. As you might expect, employees that develop successfully through this company are paid well, but they’ve earned it.

That is just one example of how a company can balance a system to meet the needs of today’s employees. Other distributors are already competitive in their pay and benefits and are looking for other ways to keep their employees happy. Get in touch with what your best employees are looking for, and find ways to help them achieve it. Again, you must ask yourself, “Are the culture and system components complementary?” Here are a few items you should examine in your culture:

  • Internal competition among employees
  • Creativity and innovation
  • Self-confidence
  • Openness of communications
  • Employee and customer participation
  • Customer service orientation
  • Propensity for action and change
  • Security and seniority (who is leaving, and why?)
  • Respect for the individual.

Once you have a clear idea of what your particular culture currently provides for employees, you can begin to identify needed changes and develop strategies to meet your company’s goals.

Opportunities for Distributors
What approaches can distributors take to differentiate themselves from the competition? Following are general suggestions for how distributors can use some of the best practices to be more successful in the future.

Be proactive and generous in rewarding your best employees. – Don’t fall into the pattern of only rewarding employees when you are about to lose them. This is one of the most common and destructive practices found in distributorships today. Spend more time figuring out how to reward your employees before they start looking around for better opportunities or someone else offers them one!

Adopt a compensation system that is clearly understood and openly communicated. – Don’t assume that because you are using a commission-incentive program that it actually is working as an incentive. Employees must understand how the system works and believe that more efforts (sales, margins, etc.) will actually earn them more dollars. If your employees don’t believe they have any control over their pay based on their efforts, then you don’t have an incentive program.

Explore alternative work arrangements. – This is one concept that has received more attention in human resources circles than almost any other. Alternative work arrangements are any scheduling patterns that deviate from the traditional 8-5 workday, including flextime, compressed workweeks, job sharing, part-time employment and telecommuting (very popular in the sales arena).

View training as an ongoing investment rather than an event. – Training in progressive distributorships is no longer an event. (“Let’s all pile into a room for two days and get trained once or twice a year.”) It’s now an ongoing process, strategically designed to help employees meet the strategic goals of the company. Learning should never stop.

Handle discipline and dismissal carefully. – Bad things sometimes happen, even in the best companies. What differentiates the best is how the tough tasks are handled. Wrongful termination suits are increasing at an almost exponential rate, and juries often show favor for the dismissed employee. Take the time to handle difficult situations carefully. Seek good advice when needed.

As you consider how to manage the new generation of employees, ask yourself this question: Do I offer employees one of the best jobs in town? If the answer is no, identify what’s missing and correct it. Remember that there is a supply-and-demand relationship for the best employees in town, and the top 20 percent of employees in the specialty gases and welding market will always have a job. Make sure they are working for you!

Gases and Welding Distributors Association

Kate Newton Meet the Author
Kathryne A. Newton, Ph.D., is associate professor of the industrial distribution program at Purdue University, located in West Lafayette, Indiana, and on the Web at www.purdue.edu.