A sense of purpose is vital to the success of any business. It allows you to stand out from the pack. It gives you direction through even the stormiest of weather. It creates a consistent culture for people to work in.

But to see these benefits you have to communicate that purpose. Otherwise, it’s nothing more than a hollow statement of intent, or at best something shared by the people at the top of the business.

Who to Reach

Whether it’s inspiring design, fast travel or just providing a smooth administrative service, the purpose of your business needs to be communicated to two distinct groups of people – your employees and your potential customers.

For employees, understanding that sense of purpose gives motivation and focus to their work. As your business becomes more complex, as rules and procedures gain a life of their own, it’s important to be able to cut through the complexities from time to time, to point at your core purpose and ask ‘are we serving that need?’

Communicating purpose to potential customers is about selling your services or products to them as individuals. Mass advertising is a dying beast. To draw in modern customers you need to reach out not with generalities but with something specific, something that directly interests the right people.

Selecting Your Audience

When it comes to employees, you know who you’re communicating your purpose to, and that’s everyone. Every single employee in your company needs to understand your purpose. If your purpose is sound but it’s one they can’t get behind then that’s a recruitment problem, not a communication one. So communicate your purpose to everyone.

For potential customers this is more complicated, but fortunately modern marketing has the answers.

Start by narrowing down who you’re interested in. Look at the data around your market. If your purpose is to provide the latest clothing trends as quickly as possible then you want to communicate that to millennials, as millennial men spend twice as much on clothing as their predecessors, while millennial women buy a third more clothing than those who came before. On the other hand, if your aim is high quality clothes that last then you want to reach a different market.

Narrow your focus as much as you can. Don’t look for the biggest audience, but for the one most interested in your purpose – that’s how you’ll make the most impact.

Communicating Clearly

No matter how grand your purpose, no matter how carefully chosen your audience, your purpose won’t be understood unless you communicate it clearly.

Communication is arguably the most important skillin the world today. The rise and rise of public relations firms, advertising agencies and communication courses proves that. The greatest innovation of our age, the Internet, exists to communicate more quickly and efficiently.

Cutting through the jargon is central to good communication. You understand the language of your sector in a way that your customers may not. You understand the language of management and business in a way your employees don’t. You need to get your purpose across in ways these groups will understand.

So spend the time and money to improve communication skills across your organization, and to ensure that your communications are expressed in terms suitable for your chosen audience. You need to be clear and appropriate in your choices, reaching millennials in the language of millennials, business leaders in the language of business leaders.

For your purpose to have meaning it needs to reach people, both inside and outside your business. That means finding the right people to approach, and the right language to approach them in. Only then will your purpose spread and come to life.

ANTHEM Divi Child Theme

The holiday season provides both opportunities and dangers for employee engagement. Excitement and distraction can get in the way of work, but festive fun can be a great way to bond people together.

Here are some tips for achieving the best employee engagement this holiday season.

Think Before Enforcing Rules

Terry Pratchett once wrote “rules are there so that you think before you break them”. That’s especially true on special occasions.

Maybe you have a rule that every team needs to have someone present throughout business hours in case there’s an enquiry. But are your B2B sales team really going to generate any leads between Christmas and New Year? Is anyone going to be contacting the internal auditors when other teams are down to skeleton crews? Maybe at this time of year some teams can be let off the hook while vital services like IT keep someone on site.

Whatever the rule standing in the way of the holiday spirit, think it through, and then clearly explain why it will or won’t be enforced. Flexibility and understanding are great ways to show employees that you see them as human beings, and so to encourage engagement.

Make Space for Silliness

People will want to have some fun in the lead-up to the holidays. Maybe it’s sticking a flashing reindeer on the desk, wearing a Santa hat, or racing tinsel-covered wheelie chairs down the office ten minutes from closing. Stamping on all the fun will make people grumpy and disengaged. Letting them get away with too much will stop any work being done.

So let people express their sense of fun in controlled ways. Festive decorations, but not ones that will intrude on other people’s concentration. Let people mess around a little in the last week, but keep an eye out for too much time being lost. In short, let things be fun as long as work still gets done.

Really Reward Good Discipline

With people so easily distracted, this is the perfect time to give rewards and praise for those who stay focused.

Some people are going to behave themselves no matter what. Some will have big deadlines they still need to hit. Some may just not be in the mood for frivolity. Whatever their reasons, the efforts of those who stay focused on work should be rewarded. Public praise or something from your regular reward system will make them feel validated rather than left out for working instead of slacking off. It’ll also encourage others to knuckle down once their lunchtime trip to the Christmas market is over.

Join in the Fun

As The Office so often demonstrated, trying too hard to be the “fun boss” can backfire badly. But holding yourself at a distance, never letting people see your human side, means that they will feel less engaged by you and your leadership.

The holidays are a perfect time to show your fun side. Join in with festivities, but do it as an equal. For the length of a team Christmas dinner or an office drinks do, let yourself be just one part of the crowd, talking about sports, TV, and holiday plans. Don’t try to dominate – that will remind people that you’re the boss. Just be.

Let Employees Control Their Celebrations

It’s a good thing for the business to facilitate work festivities. An early Christmas lunch together can help a team bond. An after work party fosters connections across the business as people relax together.

Funding this helps. A relatively small investment creates a nice show of goodwill. If you’re paying, at least in part, then employees are more likely to turn up, rather than choosing other festivities over work ones.

But there’s a big difference between paying and running the show. If possible, let employees shape the celebrations for themselves. This might be a team picking where to go eat or an improvised social committee planning the party food and decorations. The more people feel in control of the event, and the more it’s to their tastes, the more they will engage with it, relax, and have fun.

All of which adds up to better engagement with the business and their work once the party’s over.

Be Flexible About Time

Christmas and other seasonal festivities can put a lot of pressure on people, especially on their time. They’re shopping for presents, attending the school nativity, making travel arrangements, trying to attend a host of social functions, all while working. So try to avoid adding to that pressure.

Where possible, be more flexible about time. Let people take long lunch breaks to shop or leave early to attend school plays. Shuffle schedules around so that people can let off some steam at those social events. If you use flextime, let employees make up the time in the New Year, once the pressure is off. They’ll feel less stressed and more positive about work, which leads to far better engagement.

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An Emotionally Positive Workplace

Emotions are great for work. If people are allowed to bring their feelings into the workplace then their passion will show, engagement will rise, and you’ll free up the energy that might otherwise be spent on repressing those feelings.

But negative emotions can be a huge problem, creating a toxic atmosphere filled with anger and distrust. So how can you encourage emotional expression in the workplace while preventing the negatives from taking over?

Develop Emotional Intelligence

A key tool for anyone in leadership, emotional intelligence is the ability to recognize and understand the emotions of others, to empathize with them and to deal appropriately with those emotions.

Training in emotional intelligence should be a compulsory part of training for all leaders in your organization. If they can’t recognize what’s happening with their employees then they stand little chance of managing them well.

Avoid Hiring Negativity

Try to avoid hiring people who don’t cooperate well with others or who default to a negative outlook. Recruiters at Facebook do this by using questions about office politics and working with others to test how candidates respond. It isn’t a subject you can tackle head-on in an interview, but if you can find a way to incorporate it then you’ll avoid recruiting people whose negativity will kill the enthusiasm of others.

Recognize Effort

To spread the positivity around, focus on recognizing effort, not just performance.  Some employees are going to achieve exceptional things thanks to a combination of talent and the role they’ve been given. Others may not make their mark so strongly. If they only see others praised then their emotional engagement with work will drop. So openly acknowledge the effort people put in just getting the job done from day to day, whether or not they’ve done something exceptional.

Be Open

As a leader, you set the standard of behavior in your organization. What you do matters at least as much as what you say. If you don’t let other people see your emotions then they aren’t going to feel like they are allowed to express their own. So let your feelings show, especially when those feelings are of pride, excitement or delight.

This isn’t to say that you should lay your soul bare, exposing every sore nerve end of feelings. Let as much out as you feel comfortable with, and then see if you can show just a little more.

Dissipate Office Politics

Another lesson from Facebook – find ways to actively reduce office politics.

Office politics usually leads to negative feelings being stirred up, rather than encouraging positivity. So train leaders and managers to dissipate politics. Give them the communication skills to direct conversations away from these subjects, to listen to people’s concerns, and to act on then without a big drama.

Make Time to Talk

Most office politics comes from people not understanding the big picture, and so only seeing the part that impacts negatively on them. Taking the time to talk with employees, both individually and as groups, helps to counter this.

More than that, taking the time to casually chat with employees creates positive emotional bonds. The attention of a leader creates a feeling of pride and validation. A little light conversation helps to buoy the spirits, and directs attention onto things that make people happy.

So take the time to talk.

Be Honest

Lies, even well-intentioned ones, even those told by omission, create resentment. People spot the gap between words and reality even if they don’t see exactly what’s amiss.

So be honest about what’s going on with your organization. If things are tough then explain why and talk about how you’re planning to solve it. That way, employees will see that you are realistic, honest and forward looking. If things are going well then this is a time to celebrate. Either way, you bringing the focus onto the positives.

Show Kindness and Respect

A little kindness goes a long, but so does a little disrespect. If people don’t feel that their work and perspectives are treated seriously then resentment will fester.

So treat everyone equally seriously, from the lowest admin temp to the CEO. And use small acts of kindness, like remembering a birthday or making a round of coffees, to show that you don’t think that you’re above it all.

Let Go of Control

Great leaders inspire and guide rather than controlling. No-one likes to feel controlled or micro-managed, so as far as possible set the tone, set the agenda, and then sit back and let people do their jobs.

The more you try to control the flow of work, the more you sacrifice positive emotions on the altar of your ego.

Throw in Fun Events

Everyone has different ways of reviving a team or organization’s spirits, but most of them boil down to the same thing – relax and have fun. You can’t make every day into an away day or fancy dress challenge, but drop these events in once in a while. Surprise staff with a lunchtime buffet. Arrange trips out. Take your team for a drink. Associate your business with fun and people will enjoy working there more.

achievement

Why should we care about happiness?

It’s the sort of question that could only come up in business. If you were at home, on holiday or out on the town socializing then the answer would be obvious. To a child, the desire to be happy is so obvious they probably couldn’t even put a reason into words. Happiness is what motivates us, what makes life worthwhile. Everything else we value is a means to that end, for ourselves or for others.

Yet happiness at work is something we often ignore. Some even scoff at talking about it. So why should you care about workplace happiness? And as a leader, how can you inspire and spread joy?

Why Workplace Happiness Matters

Years ago, I got into a conversation about work with a friend of the generation before mine. He didn’t do an especially unusual or entertaining job, yet he took joy in it. He said that he couldn’t bear the thought of spending his day watching the clock, just waiting to leave. If he was going to spend that much time doing something, he needed to enjoy it.

His words pinned down a long standing problem – the dissonance between how we ideally believe we should live and how we have accepted that we must work. We have been told that we should make ourselves happy, yet we have also been told that we should put our noses to the grindstone and work no matter our feelings. This creates cognitive dissonance, unsettling us on a subconscious level. Add that to the demotivating effect of doing something you don’t enjoy, and your energy is sapped.

Hence the extraordinary range of figures showing the benefits of workplace happiness:

  • SHRM found that satisfied employees perform 20% better.
  • The Dale Carnegie Institute found that companies with satisfied employees may perform twice as well as competitors.
  • HBR found happy employees to be 3 times more creative, 31% more productive, and generate 37% more sales.

Knowing its value, how can you encourage happiness in the workplace?

Keeping Yourself Joyful

Start with yourself. There are three reasons for this:

  • If you’re happier you’ll be more productive, and a more productive leader means a more productive business.
  • You’ll set a great example to employees, and encourage them with your positive energy.
  • Your happiness is just as important as everyone else’s – happiness for happiness’s sake is reason enough.

How to go about it? That’s going to depend a bit on what makes you happy, but certain things are universal.

Celebrate Victories

When you succeed, don’t rush straight on to the next problem. Take five minutes to look at the implications of what you’ve achieved, and to bask in the mental glow. For landmark moments, go out and celebrate with the others involved. Prove to your brain that all this work was worthwhile.

Positive Thinking

It might sound absurd, but you can train your brain to be happier. Concentrate mentally on the positives of your work – the parts you enjoy, the people you work with, the good you do. When you get angry, annoyed or disappointed, shift back to the positives. Keep doing it until you can get through a day and then a week without lingering on the negative thoughts. Your mood around the office will improve.

Mindfulness

If you struggle to let go of the negative thoughts then try a mindfulness exercise. There are plenty of them on YouTube. It will help you to let go of any thoughts, positive or negative, to identify what’s bothering you and to clear the pathway for positivity.

And yes, I know how new age this sounds. But the brain is like a muscle – if you exercise it in a particular way then you’ll get better at that thing – even being happy.

Keeping Your Employees Joyful

Having made yourself happy, how do you spread this among your employees?

Positive Reinforcement

The first point is the most obvious one – provide plenty of positive feedback for good work and behavior, whether it’s something above and beyond the call of duty or simply getting the daily job done. Praise positive attitudes as well as good work. Make people feel good about feeling good.

As far as possible, avoid focusing on the negatives. Make negative feedback and disciplinary processes quick rather than drawn out. This way you avoid emotionally validating human tendencies to focus on the bad.

Foster Engagement

There are a host of tips for this across the internet, including in my book on using marketing techniques in HR. The important thing is that you reduce people’s detachment from their work, creating a real emotional connection. If they aren’t positively engaged in what they’re doing then they’ll be watching the clock.

Listen

Open your ears and your mind. People love talking about themselves and their work, and if given the time to talk about them then they’ll feel happier. Make a note of any problems, making clear you won’t ignore them, but try to bring the focus onto positives and achievements, bringing happiness to the forefront of employees’ minds.

Ask Why

Don’t ignore the problems that have been pointed out to you, or the people who are constantly unhappy. When you get back to your desk, take the time to dig into why those problems are arising, and what you can do about them. Then make the change and celebrate it, smoothing out the pathway to happiness for others even as you reinforce it in yourself.

You Can Make Happiness

Happiness doesn’t just happen, it’s something you can produce. So focus on that, and make a happier, more productive workforce.

Let It Go

What do wartime generals and effective parents have in common?

They can both help us to become better leaders by letting go of control and instead setting expectations.

The Family Business

As we try to tackle issues of income inequality, it’s increasingly recognized that parenting really is a full time job, with all the hard work and specialist skills that involves. What we’re slower to recognize is that parents are a group of professionals we can all learn from.

Delving into a description of parenting may seem like teaching some of you to suck eggs, but for others – those without children – this is a world of mystery. And that balance between the risk of becoming patronizing and the risk of not giving enough information or guidance is one that parents face every day.

You’re under pressure from the kids to provide attention and cater to their physical needs, a pressure that becomes less constant but no less real as they grow up. At the same time, you’re under pressure from yourself to make sure that they’re safe, happy and learning to deal with the world in appropriate ways. With every ounce of energy going into this balancing act, it’s easy to take shortcuts, and that’s the point at which parenting becomes controlling.

It’s easier to say “you can’t go to that place” than to teach your child to play safely in a less secure environment. It’s easier to discourage their friendship with a child whose influence you don’t like than it is to balance that influence or discuss why their behavior is a problem. It’s emotionally easier to keep micromanaging a child’s behavior, pointing out every time things might go wrong, than to let go and let them take risks, risks that might hurt them but that will let them grow. Because you aren’t just risking your child’s health and happiness – you’re risking your own feelings too.

The more you control a child, the less they get to develop their own courage, judgement, and initiative. And if you don’t notice the point at which children outgrow old restrictions then you risk creating the resentment that is the hallmark of the sulking teenager, with all the sour relationships and wasted emotional energy that entails.

Effective parenting involves setting boundaries, explaining why they exist, and then trusting children to respond to those boundaries. It means actively involving kids in their lives, through making them part of conversations about what to do at the weekend, or through giving them chores around the house, making them part of the house-keeping team. It means giving them as much initiative as they can cope with at their age.

Think back to when you were a kid. Did you like it when your parents were controlling? Or did you prefer to be trusted? Now think about how it feels, as an adult, to be controlled and not to be trusted.

That feeling is why we should learn from effective parents. Set boundaries in the workplace instead of micromanaging. Let employees take risks. Involved them in decision making.

Don’t control.

Purpose and Doctrine

How do you let go of control without causing chaos? How do you guide without micro-managing?

Mark Bonchek of Shift Thinking has made an excellent argument for adopting the military approach of providing purpose and doctrine.

In war, it’s impossible for leaders to control what is happening on the ground. Enemy action and unforeseen accidents mean that troops have to be able to adapt. For these adaptations to be effective they have to follow the best steps towards victory. And so troops are provided with purpose and doctrine.

Purpose is the aim of the battle, campaign, or even war. For a business, it is the goals, both long and short term. So set targets and make sure to share them. If soldiers know what the aim of the fighting is then they will be better equipped to make decisions that serve that purpose. If employees know your goals then they will be better able to keep working towards them.

Doctrine is a set of guidelines for achieving that purpose. It could be anything from Henry V’s adoption of defensive archery formations to the way a modern war fleet is structured. Doctrine doesn’t tell soldiers what decisions to make, but it tells them how to make those decisions.

The equivalent of doctrine in most organizations will be procedures and other guidance documents. Badly written and inflexible procedures can be controlling and counter-productive. They rigidly define every last minute detail of a task, leaving no initiative to adapt to circumstances.

Good procedures instead provide a doctrine. They leave employees free to make decisions appropriate to their skills and level of authority. They let them make use of the knowledge they have developed. They don’t force them to repeatedly contact a harassed customer in order to achieve a mythical image of customer service.

Letting Go is Hard

It’s hard for a parent to let go and trust their children to behave safely. It’s hard for a general to put his carefully shaped strategy in the hands of subordinates. It’s hard for a manager to leave others to make decisions that they know they could make.

But ultimately, letting go of control, replacing it with purpose and doctrine, will lead to happier and more effective employees.

Ever since the arrival of Generation X (Gen X), there’s been a wealth of analysis on what each new generation of employees wants. The information is there for us to use, the strategies are simple, and we all nod our heads sagely whenever we hear that Gen X want authenticity while millennials want flexibility.

But for all this knowledge, there’s a huge gap between what we as leaders know and what we do.

Millennials Want Flexible Working

Let’s start with the wave of employees businesses are most focused on right now – the millennial generation. Born in the 1980s, they’ve been raised on the hype of freedom and flexibility, the idea espoused by both left-wing social liberals and right-wing economic liberals that you can and should create the lifestyle you want.

Making this a reality means flexible working, and many companies are trying, or claiming, to provide this. But the reality doesn’t live up to the hype. Recent research by EY found that one in six millennials had suffered negative consequences from using flexible working, facing negative impacts on their careers, while 47% said that their hours had increased in the past five years, a change that makes it harder to work in a flexible, balanced way.

The Smartphone Generation Want Personalization

Attention is starting to turn toward the upcoming Generation Z, sometimes referred to as the iGeneration. Brought up in a world of smartphones, internet access and social media marketing, this generation wants and expects things to be personalized for them, as shown in recent research by Schneider Associates and The Pollack PR Marketing Group. Joan Schneider has provided insightful if unsurprising analysis into how marketers can make use of this, and as I’ve discussed in my book Nothing Short of a Necessity, marketers are often the first to learn these lessons, and other areas of business need to learn from their insight.

When looking at the iGeneration as employees, this means that we cannot take them and try to fit them into existing approaches to work, or in some cases even job roles. If we are to retain employees of this generation and get the most out of them, we need to adapt around their skills and personalities. It’s flexible working taken even further, and having failed to live up to the flexibility challenge, we’ll find this one even harder.

Generation X Want the Genuine

This disconnect between what we provide and what the up-coming generations want isn’t down to lack of effort. After all, thousands of hours have been spent analyzing and discussing millennials and implementing strategies built around them.

So what’s going wrong?

To understand that it helps if we take a step back and look at Generation X. One of the most often repeated truths about Gen X is that they want leaders to be genuine. It’s such a common insight that it’s now talked about as an across-the-board necessity, and yet it’s one we often don’t live up to. Think about the last time you went on a communication and persuasion course, or prepared for a big presentation. Was it really all about being open and genuine, or were there things you were exaggerating and trying to hide?

We avoid being truly genuine because that means taking the risk of opening up and, in doing so, exposing ourselves to risk. It’s the same reason we don’t take flexible working far enough or genuinely adapt around the needs of employees – because it’s risky, and we fear risk.

But if we aren’t willing to take those risks, to be open, adaptable and willing to build business around our individual employees, then we’re never going to provide the leadership future generations demand.

The foundation of good communication isn’t the words but the feelings underlying them.

As leaders, we set the tone for communication in our businesses. We know that we set an example, and that the way we communicate will set the tone for the organization. But why is this important? And how can we break out of the trap of toxic communication to improve both the happiness and the productivity of those around us?

The Importance of Good Communication

Good communication is important for a number of reasons.

Most obviously, there are the inefficiencies that come with poor communication. A study by academics at the Harvard Medical School and the University of Boston found that over $12 billion per year is wasted in the US medical sector alone due to inefficiencies caused by poor communication.

Communication is an important factor in limiting conflicts, improving employee satisfaction and avoiding employee burnout. Other studies have shown how communication variables play a direct part in satisfaction and burnout, and so in both the productivity of your workforce and how long they stick with you.

Good communication is not just nice to have. It’s vital to the smooth running of any business.

Creating Positivity

Yet poor communication is the norm in many businesses. Typical workplace conversations contain four times as much rehashing of past problems and assigning of blame as they do focusing on the present and looking to the future. This leads to an atmosphere of fear and tension, and increases the number of uncomfortable conversations. It creates a combative mentality that prevents cooperation.

Even trying to lighten the mood can do damage when it’s done wrong. Aggressive humor may feel like light banter to the person using it, but in reality it’s about disparaging others to manipulate them, and does more harm than good.

This isn’t to say that you shouldn’t crack jokes – quite the opposite. Humor can increase happiness by up to 42%, and a study found that subjects who watched a comedy video beforehand were nearly four times as likely to solve a problem.

Positive communication is something that you can model and teach from a position of leadership. If you find yourself using negative humor, assigning blame or focusing on the past then stop and re-think. Look for a more positive thing to say, one that asserts shared values and focuses on future achievements and solutions. If you hear others in positions of leadership dwelling in the negative then take them aside and let them know the harm they’re doing. It’s only by providing a set of positive models that you can improve communication.

Understanding Discomfort

This isn’t to say that you can completely do away with uncomfortable conversations, or keep avoiding them in favor of jokes and dreams. Certain conversations in particular make people uncomfortable. A recent survey by Fractl showed that most people feel uncomfortable when discussing accountability or tackling a difficult person.

If they aren’t addressed then uncomfortable issues will fester, and so those conversations need to be had. But this can lead to a bullish approach, trying to tackle the problem immediately and head on. If you’re focused on creating more positive communication then it can be particularly tempting to charge into such conversations to see them over and done with.

Instead, take a step back and consider the causes behind a difficult conversation. If people are avoiding accountability, why is that? If an employee is being difficult, what is making them uncomfortable? Are you uncomfortable because they’re being troublesome, or because they’re challenging your assumptions?

Understanding the discomfort will allow you to steer the conversation away from a head-on conflict over the surface issue. Instead, you can tackle the underlying patterns. This will lead to better communication, more substantial solutions, and a calmer atmosphere. If emotional energy isn’t being spent on arguments then it can be spent on positive interactions, humor and fun, making the positive side of office life more emotionally fulfilling than the dramas. If negativity is where all the emotional fulfilment lies, then people will drift towards it.

Managing Your Emotions

This, ultimately, is the bedrock of good communication – not the words, but the feelings underlying them. Yes, the words are important in expressing and shaping those emotions. But emotions are what shape people’s satisfaction and productivity. Strong emotions bring out the best and the worst in us.

As a leader, your emotions can have a huge impact on the people around you. You therefore need to be aware of what you are feeling and how it is affecting you. Practice mindfulness techniques, taking ten minutes out when things get difficult just to focus on your breathing, empty your mind and see what thoughts or feelings emerge. Study them, see where they are coming from, and let go of negative thoughts when you can. When you can’t let go, look at what you can do to change the situation.

Managing your emotions in difficult conversations is important. You’re the example to your employees of calmness and positivity, emotions that will create better communication. But suppressing negative emotions won’t help you to do this, any more than dwelling on them will. You need to understand where your own mind is at.

By fostering positivity, understanding causes of discomfort and managing your own emotions you can create better communication around you, and set an example of it throughout your business.

Social business isn’t just about creating more ethical products. It isn’t about small tweaks that make a business less ugly. It’s about addressing the fundamentals of society and of a business within society. And nothing is more fundamental to business than pay. After all, nobody would go to the office without it.

So what are the problems with the current approach to pay? And what might we change to make pay work better for society?

Letting Go of Entitlement

There’s a reason why we’ve heard so much talk about entitlement in recent social debates. Arguments ranging from political engagement to the plots of computer games often boil down to attempts by one side to create greater equality, while the other side defends the status quo, feeling they are entitled to what they have simply because that’s how things have been.

Like the angry voices of “Gamergate,” many in business feel entitled to ever-rising pay. In this view, doing well entitles us to ever higher wages. Our pay should never drop unless we make a cataclysmic error. And it indulges those at the top to massive sums, with CEO’s receiving 300 times as much as average workers.

But this approach to pay is not set in stone. As recently as the 1970s, the pay ratio between CEOs and average workers was only twenty-five to one. Ever-rising wages are connected to the dangers of inflation.

If we let go of our entitled assumptions, what models could we adopt instead?

Leaving Behind Performance-related Pay

One model we certainly shouldn’t expand is performance-related pay. The example of high-powered sales forces, and the obvious appeal of a chance for more money, have led to performance-related pay increasing dominance of leadership compensation.

But a large number of psychological studies have shown that performance-related pay is not only less effective than its advocates believe – it can actually be harmful. In a similar way to having an audience, performance-related pay adds psychological pressure. This can increase productivity in jobs that require little mental engagement. When complex thinking is required, however, it gets in the way, leading to worse performance when high pay is at stake. Competition for these rewards crowds out beneficial cooperation, and the mechanisms of performance-related pay create complications, frustrations and extra work.

In short, the high flyers of the 1980s were wrong – greed isn’t good, and tapping into it is harmful.

Making Pay Levels Relative

Letting go of performance-related pay and entitlement to endless growth creates new possibilities. If we want to be socially responsible then we should build pay around the whole social unit of a business, not just its individual parts.

The Israeli government may have the solution.

A recent law passed 56-0 in the Israeli parliament has capped the salary of top banking and insurance executives. But this is not a simple maximum payment – it is tied to the salaries of employees, with leaders in these businesses unable to earn more than 44 times the salary of their lowest paid employees.

Think for a minute about what that means. If pay is a ratio then executives at the top have an interest in improving pay for everyone in the company, not just themselves. The interests of those at the top of this part of society are now tied to those at the bottom. There will doubtless be loopholes, and for such a measure to be truly effective it needs to cover contractors as well as employees. But as a way to make those at the top of a business help those at the bottom, it’s a powerful measure.

The implication for creating a real living wage is obvious. To be meaningful and resistant to inflation, that wage has to be connected to the highest wages in society. Wealth, after all, is a relative rather than an absolute measure.

And for those of us running socially responsible businesses, the time is ripe to consider applying similar measures to ourselves. 44 times as much income as the lowest paid employee is still a staggering gap, though less than in the largest US businesses. Consider what ratio you think is reasonable, and apply it within your own organization. Give everyone an interest in raising everyone else’s income.

Letting Pay Drop

Another recent example of how we can change attitudes toward pay comes from Richard Pennycook, the head of the UK’s Co-op Group. This Co-op, Britain’s largest ethically run business, has been struggling in recent years, and Pennycook has helped right the sinking ship. Most executives in his position would have asked for more pay based on their success, but not Pennycook. Instead, he has publicly asked for a drop in his pay because of the reduced workload his success has created for him.

It’s an example to us all. It’s not unreasonable for top executives to ask for more pay when putting in the work on tough situations. But increased pay should not continue indefinitely. When the time comes, and the work is done, perhaps we could all seek less pay, in proportion with a changing role. Perhaps high pay could be constantly assessed against the reasons for which it was initially given.

There are doubtless other ways to rethink pay. What’s important is that we start by throwing out our assumptions and trying something new.

people

Are you ready to tap into Employees’ Social Skills?

Social skills have always been important to work, though their vital role is not always well recognized. With the growing sophistication of management techniques and the meteoric rise of social media, they have leapt to the forefront, and are now on the minds of recruiters and managers looking. But if you want to make the most of these skills, it is not enough just to recruit the socially adept. You need to find ways to best channel the social skills of all your employees.

The Age of Social Skills

A recent paper by David J. Deming illustrates the long term rise of social skills. Analyzing data gathered by the U.S. Department of Labor, Deming found a steady increase in the importance of social skills across the American workforce since 1980. In the space of a generation, the amount of time committed to social tasks rose by 24%, and continued to rise even as other rising skill sets went into decline.

The importance of this finding cannot be overstated. The prominent place social skills have gained in recent years is not just a reflection of the rise of social media. It is part of a long term trend, one that looks set to continue. Your workforce will increasingly be focused on social tasks, and you need to be ready for that.

The Danger of the Vague

Making your business more socially skilled is not just a matter of employing people with those skills and hoping for the best. Even recruiting for social skills in focused areas won’t achieve great results if you don’t think about what you want those skills to achieve.

As with employee engagement on improvement schemes, recruiting a pool of socially skilled people can backfire. If not directed properly, those skills may be turned to gossiping and idle socializing around the office, developing unhelpful relationships with outside stakeholders, or simply becoming frustrated. Social people need to be given the opportunity to productively use their social skills.

Think about how you want those skills to be deployed, and then brief staff on this. Tell them what sorts of external relationships you want them to develop, how much it’s appropriate to spend time simply bonding as a team, and how you want them to present the company to the outside world.

If you are specific, you will get the results you want and avoid frustrating your skilled new employees.

Treating Social as a Skill

There is another way in which we need to treat social skills more like any other skill set. We need to develop them in existing employees.

Social skills, like creativity, are often treated as something magical and otherworldly, that people simply do or don’t have. But just like creativity, they should not be treated this way. They are learned techniques that can always be improved. They can and should be fostered and developed in the staff you have.

Over 70% of workers believe that their performance improves when they receive feedback. Goals are 46% more likely to be achieved if they are written down. Why wouldn’t you want to see these sorts of results in the most important and growing skill set, social skills?

It won’t always be easy, but finding targets and measures for social skills is a vital part of improving them. Make managers responsible for feeding back to staff on their use of social skills. Set targets around how they are used. Provide training and mentoring. If you value social skills, then show it.

All work involves human interaction, and social skills are vital for that. So don’t just recruit for them – channel them, develop them, and see them shine.

Why Businesses Need to Act Openly, Inside as Well as Out

“Word spread because word will spread. Stories and secrets fight, stories win, shed new secrets, which new stories fight, and on.”

― China Miéville, Embassytown

If ever a case needed to be made for greater openness in business, then Volkswagen have inadvertently made it. The lies and secrets around emissions from their vehicles, which continue to be uncovered week by week, month by month, have done the company huge damage. Human beings are wired to understand the world through stories, and in the public imagination this story of deception outweighs many facts about the quality of Volkswagen cars.

This is no isolated case. It represents a wider social shift that shows why businesses will benefit from being more open.

The Need for Openness

The rise of Generation X was meant to see the end of idealism. The fractured moral landscape of postmodernity and the lack of clear sides that came with the supposed ‘end of history’ were set to turn us all into cynics.

Instead, we live in a more idealistic age than ever before. Customers have realized that their food is full of chemicals and their financial institutions riddled with corruption, and instead of accepting this they demand something better. Research by Morgan Stanley shows that millennials are three times more likely to seek employment with a company they consider to have good ethics, and twice as likely to buy or invest in products aiming for better social and environmental results.

These idealists won’t just believe a company when it smiles and says that it is good. They want proof, and the result isn’t just scandals like that hitting Volkswagen. It’s also long term changes like the clean label movement, where food manufacturers are increasingly cleaning up what they put into food, because consumers are checking the labels, looking for the products with the least additives. The success of companies such as drinks manufacturer Innocent stem from the goodwill they can achieve by acting cleanly and being open about what they do.

There is no guarantee that any company, even one as powerful as Volkswagen, can keep its dirty secrets hidden. Better to be open and reap the benefits.

Open to the Core

Openness isn’t just beneficial when dealing with customers and investors. It also brings benefits within a company.

Think about performance reporting or the growing use of analytics. These things don’t work if people don’t share their data within the organization. You need them to be open with you about how they’re doing, good or bad. This lets you measure achievements and improve upon flaws. It’s the foundation of good management.

Openness is also vital to employee engagement. Openly sharing plans and information helps to build trust, to show employees that they are a valued part of the business. The sudden springing of surprises, or the leaking out of secrets through rumors within the organization, undermines that sense of being valued. By being open you show employees that you value them, and that in turn will encourage them to value you. They’ll be more committed, and put more into their work.

Learning From Volkswagen

Your brand is one of your most important assets. It’s an ephemeral thing, woven of stories and vague impressions. The taint of deception can corrupt your brand for a long time, making you seem untrustworthy. It’s a problem Volkswagen will have to work hard to overcome.

Being open about your business practices protects you from the risk of being seen as deceptive. It also opens you up to a growing group of modern customers who are interested in working with ethical companies. It even helps your business to run more smoothly internally.

So set aside the temptation to secrecy.

Be more open.