The Secret Sauce

By: Natasha Hawker & Caroline Ross

Why do some people want to desperately work for some businesses and avoid others like the plague? Mostly it can be put down to culture or the managers’ reputation. But how do you make or create a culture? Why would you bother? My thinking is that if more businesses focused on their cultural strategy, many of the other metrics such as performance, productivity, attrition & engagement would increase as a result.

Recent research shows categorically that employees want to work for authentic leaders. So what does this mean? Is it as simple as being a decent human being? No, I am afraid not - as the authentic leader also needs to be coupled with an authentic organisation. The good news is that as an entrepreneur or small business owner, you can determine the culture of your organisation.

 So how can you do this?  You can break it down into these six key cultural factors:

1. Vision: A great culture starts with a vision or mission statement. These phrases guide a company’s values and provide it with purpose. That purpose in turn, orientates every decision employees make. When they are deeply authentic and prominently displayed, good vision statements can even help orient customers, suppliers and other stakeholders.  A vision statement is a simple but fundamental element of culture.

2. Values: A company’s values are the core of its culture. While a vision articulates a company’s purpose, values offer a set of guidelines on the behaviours and mindsets needed to achieve that vision.

3. Practices: Values are of little importance unless they are enshrined in a company’s practices. If a business professes, 'people are our greatest asset', it should also be ready to invest in people in visible ways. Whatever the company’s values, they must be reinforced in review criteria and promotion policies, and fully lived and incorporated into the operating principles of daily life in the business.

4. People: No company can build a coherent culture without people who either share its core values or possess the willingness and ability to embrace those values. That’s why the greatest firms in the world also have some of the most stringent recruiting policies.  One study found applicants who were a cultural fit would accept a 7% lower salary and departments with cultural alignment had 30% less turnover. People stick with cultures they like and bringing on the right culture carriers reinforces the culture a business already has.

5. Narrative: Any company has a unique history — a unique story. And the ability to unearth that history and craft it into a narrative is a core element of culture creation. The elements of that narrative can be formal — like Coca-Cola, which dedicated an enormous resource to celebrating its heritage and even has a World of Coke museum in Atlanta — or informal, like those stories about how Steve Jobs’ early fascination with calligraphy shaped the aesthetically oriented culture at Apple. But they are more powerful when identified, shaped, and retold as a part of a firm’s ongoing culture.

6. Place: Why does Pixar have a huge open atrium engineering an environment where business members run into each other throughout the day and interact in informal, unplanned ways? And why do tech firms cluster in Silicon Valley and financial firms cluster in London and New York? There are obviously numerous answers to each of these questions, but one clear one is that place shapes culture. Open architecture is more conducive to certain office behaviours, like collaboration. Place — whether geography, architecture, or aesthetic design, impacts the values and behaviours of people in a workplace.

There are other factors that influence culture. But these six components can provide a firm foundation for shaping a new organisation’s culture. Identifying and understanding them more fully in an existing organisation can be the first step to revitalising or reshaping the inherent culture in a company looking for change.

Natasha Hawker owns Employee Matters Pty Ltd; an HR Consultancy that assists small to medium businesses with their HR functions to make them more efficient and profitable. Their offering includes HR Management, Recruitment, Training, Coaching, and Exit Management – find them at www.employeematters.com.au

Biased ? Not me

By: Natasha Hawker

I was visiting McDonalds yesterday on the behalf a client and, as I was leaving with my host, the lift opened and a women entered - average height probably in her late thirties - my host exchanged the usual type of pleasantries with her, as you do in a lift, so I assumed that she was a colleague and mentally pitched her at middle-management level. When we exited the lift and were out of earshot, my host said proudly 'that is our CEO, Catriona Noble. '

Well, my Unconscious Bias was working overtime as always - you see, as much as I pride myself on the 'women can do anything' mantra and the need - no, the criticality of getting more women to the boardroom - I envision, unconsciously, a CEO as male, in their 50s and over 6ft tall!

So my apologies and my admiration, Catriona - I only hope that you mentor and encourage more women to the top, during your time at the top of the Golden Arches.

Natasha Hawker owns Employee Matters Pty Ltd; an HR Consultancy that assists small to medium businesses with their HR functions to make them more efficient and profitable. Their offering includes HR Management, Recruitment, Training, Coaching, and Exit Management – find them at www.employeematters.com.au

HR data....Yawn!! - but wait - you do need to know this

By: Natasha Hawker

HR has long had a 'touchy feely' reputation but this is fast changing and in my view will continue to do so. At the big end of town, bit by bit the data is changing or improving the decisions made around what is often one of the most expensive costs to a business - your people.

I believe that SMEs need to watch, learn and take best practice from the corporate world, but use it if, and only if, it works for your business. That said, I believe that you can learn from their mistakes but also apply it in a way that makes sense for you.

For example - what is the current employee turnover of your business as a percentage of your total headcount? As a guide, a healthy turnover is about 10-20%, depending on your industry. Why does this matter? - because it is damn expensive and time-consuming to replace people, but it also means you are not focused on what you should be! Not only that, there will be a dip in productivity as a result.

How would tracking the trends help? Well, for a start you might see the following:

• cost management opportunities
• identification of roles that are particularly difficult to retain and so develop strategies to address this
•  identify management issues
• determine whether you are struggling to identify what you really need
• improve your company's attractiveness to the market- why would someone want to work for you?

 There are a number of beneficial pieces of data that are worth capturing as this will enhance your decision making ability - some other metrics you might want to consider are: 

• workforce mix - permanent full / part time, temps, casuals & independent contractors
• annual leave liability vs. scheduled annual leave
• managed attrition vs. unmanaged attrition
• absenteeism trends / issues

 All the above are costs to your business but also they are levers that you can pull to reduce costs.

What metrics are you measuring and how has this impacted your business?

Natasha Hawker owns Employee Matters Pty Ltd; an HR Consultancy that assists small to medium businesses with their HR functions to make them more efficient and profitable. Their offering includes HR Management, Recruitment, Training, Coaching, and Exit Management – find them at www.employeematters.com.au

Merger anyone?

By: Natasha Hawker

Now things seem to be looking up are you thinking about a merger or acquisition? Many SMEs decide one of the quickest ways to grow your business is to buy another one.

There is a lot of due diligence required around the financials, compliance and other legalities - but there are also the legal requirements if you want to take on the seller's employees - if you are considering this I would recommend that you complete the following checks:

• review all employment contracts - it's likely you will find a wide variety of them - which,  as the new owner, you will need to meet the BOOT test (more on this later)
• personnel file audit - what are the performance levels of the current employees
• what are the absenteeism rates like? - if high, there may be an underlying problem
• what is the current percentage rate of attrition? - is this managed or unmanaged
• what type of training is recorded? What's the frequency of this
• what are the accident or near miss rates like?

 Collecting and analysing this information will provide you with a wealth of knowledge about the employee footprint and will also provide the value proposition of the employees, (or alternatively the problems you are about to inherit).

Example - I knew of a company that had casual employees on permanent contracts - not great but not the biggest problem - these employees had upwards of twenty years service. The buyer did not check the personnel files, so has just inherited a massive liability in terms of long service leave and redundancy payouts. Now obviously the seller did not share this piece of information and had they, the sale may have proceeded but it would have likely affected the price.

If you are looking at transferring employees across to your company and a warning up front - this is a complex area of employment law, you must pass the ‘BOOT’ or the Better Off Overall Test. This effectively means the employees transferring across cannot be made to settle for employment conditions less or lower than their current situation. This is beyond compensation and could cover conditions such as additional annual leave or guaranteed training budgets. A further consideration is - how will this impact your current team when they find out the new guys are on a better deal?

Have you had any experience positive or negative experiences in this area?

 Natasha Hawker owns Employee Matters Pty Ltd; an HR Consultancy that assists small to medium businesses with their HR functions to make them more efficient and profitable. Their offering includes HR Management, Recruitment, Training, Coaching, and Exit Management – find them at www.employeematters.com.au

Are you ready to go back to Work Choices?

By: Natasha Hawker

Good morning to a new Coalition run Australia. After quite possibly the longest ever campaign in Australia’s history we're done – but are we? After a massive swing to the Coalition across the country does this mean that SMEs need to brace themselves for further changes to the already complex world of Employment Relations? I hear you say - 'But hey I was only just getting my head around Fair Work – arrrgghhhh!' So what is the likelihood of large scale change in this area? Let’s look at this in more detail.

Previously, I attended a luncheon with Joe Hockey and Executive Women he was quite adamant that there was unlikely to be much change to the current employment relations landscape. I do tend to believe him, as I think that with their other major agenda items such as the Carbon Tax their focus there will leave little time for much else in the short term. I would only anticipate a couple of minor tweaks, for example, reducing the Unions ready access to the workplace this area. Presently, I don’t see that there is much appetite within the government to revert to Work Choices. It is a very low priority for them at the moment. They are much more likely to try and increase productivity using other levers, such as company tax and the Carbon tax. This is despite an increased appetite amongst businesses for greater relaxing of Employment Relations legislation however, I would not pin too much hope on this coming off in the near future.

Even if I was wrong, it would take another 18 to 24 months to implement, so no urgent changes are required. However, I am always surprised at the low levels of compliance with even the basic Employment Relations requirements. Please take our HR Survey to get an instant assessment of your gaps.

My overall assessment is that it will be minimal & delayed change but my advice is if you work to achieve engaged and well managed teams then productivity and profitability will follow.

Natasha Hawker owns Employee Matters Pty Ltd; an HR Consultancy that assists small to medium businesses with their HR functions to make them more efficient and profitable. Their offering includes HR Management, Recruitment, Training, Coaching, and Exit Management – find them at www.employeematters.com.au

Why Exit?

By: Natasha Hawker

Why would you ever want to do an exit interview?

Just recently, a client of ours had a senior member of the team resign and we are assisting them with the replacement of this role. We have just conducted an independent exit interview with the employee leaving the role - you might ask 'why?'

You might also say good 'riddance!' Or 'what would be the benefit of that?' Well, I'm glad you asked:

1. Recruitment - in the case above, the employee had faced some challenges in the role and before recruiting for this role again, we were able to obtain detailed information that will help us recruit the best possible candidate for our client
2. Information - employees are generally more forthcoming when they have resigned. You often find out ‘gems’ of information that would otherwise be withheld. Is this perhaps an opportunity to restructure the team or reduce headcount at a low cost point?
3. Rehire - ever lost an employee that you wished that you hadn't and wished you could get them back? An exit interview is an opportunity to reiterate the fact that should they ever wish to return they are welcome to approach the business to see whether there is a suitable role available. People need reassurance after resigning to ensure that there are no hard feelings or misunderstandings 
4. Stats - why are your team leaving you? Is there one team or area that has particularly high turnover? Is this telling you that there is another, bigger problem that you need to deal with to stop the drain of skills & talent? Healthy unmanaged attrition should be between 10-20% 
5. Alumni - ex-employees can become future clients, advocates for your business, rehires or just great sources of information. Take a longer term view of the resignation and the opportunity that it might bring rather than the gap it creates

 You should have someone other than their direct manager complete the interview - either HR or a manager from another team or division. You should have set questions, so that you can develop data over time for analysis.

Do you conduct exit interviews in your business and, if so, what have you learnt from them?

Natasha Hawker owns Employee Matters Pty Ltd; an HR Consultancy that assists small to medium businesses with their HR functions to make them more efficient and profitable. Their offering includes HR Management, Recruitment, Training, Coaching, and Exit Management – find them at www.employeematters.com.au

Want to save about $8,000 on your recruitment spend?

Now - let me start by saying that we are not a Recruitment Agency - far from it! We recruit for our clients for an hourly rate and there is no success fee. This typically saves businesses up to 70% off their recruitment costs. To you and your candidates, we look and feel like your very own internal recruitment team.

We made one of our clients very happy today. Over the years he has become used to paying recruitment agencies on average $8,500 + GST per placement - but then he started using Employee Matters for recruitment and he gets great service including:

• the same experienced corporate Recruitment Partner each time
• the ads are written for his approval, based on his criteria
• the candidates are carefully screened all candidates are treated with respect 
• and every application is responded to, whether ultimately successful or not

 One time he came to us with a role, we found two candidates that he really liked and he had to make a tough decision - but this was handled with care and sensitivity.

Two months later, with his business expanding, he needs another employee. We rang the candidate that had placed 2^nd the first time around; he was still interested, was interviewed again and offered the role. He is thrilled and so is the client, because instead of paying over $8k - he paid $500.

When I asked the candidate why he would reconsider a role that he was originally the 2nd choice for, he said "Tiffany was incredibly sensitive and caring but diplomatic and professional. She gave me detailed feedback and it made sense. She handled it in such a way that I was happy to hear this news from her. It was only the second time in my life that I have dealt with someone in recruitment that was supportive rather than just doing her job.” (Otis)

More of our clients are enjoying working with their Employee Matters Recruitment Partner, reaping the benefits both financially and through the ease of the process. They enjoy having an expert helping them make the right recruitment decisions.

Do you think that this model of recruitment might work for you?

Natasha Hawker owns Employee Matters Pty Ltd; an HR Consultancy that assists small to medium businesses with their HR functions to make them more efficient and profitable. Their offering includes HR Management, Recruitment, Training, Coaching, and Exit Management – find them at www.employeematters.com.au