Profitability and People

Darrell Lim is our Vice President of Operations at CityMax but he is also a trained organizational development coach. Find out more about him and get more business insights at his CityMax powered business website:

No doubt, profitability should always be the focus of any successful organization. As we approach the halfway mark of the year, you are probably firmly aware of how much profit your business has already made and how well it is projected to do this year.

At the end of the day, no matter what goals you set, you must never neglect the importance of growing the human capital of your organization. These critical levers to business success stay largely the same regardless of the industry that you work in.

Recently, top areas of business focus for 2012 were identified by thousands of organizations that participated in a research study by the BC Human Resources Management Association. The results were:

  • Increasing Leadership Capability – 31%
  • Increasing Employee Engagement – 27%
  • Attracting & Recruiting Staff – 26%
  • Managing Change – 26%
  • Planning for Staff Succession – 23%
  • Managing Staff Performance – 23%

How many of these focuses do you relate with? Consider the following:

Increasing Leadership Capability

  • How much more profit/client value would you experience if your leaders were freed up to lead and innovate in new ways? What impact would 10% more time have on the bottom line?
  • What areas of your leaders’ responsibility could they improve if they were given time and resources to retrain and retool? What would the impact be on the bottom line?
  • What would the impact be on the bottom line if your key leaders stopped fighting with each other and actually learned to work well together?

Increasing Employee Engagement

  • If your employees actually trusted each other, what sorts of dividends would that multiply into?
  • What would productivity look like if your team actually enjoyed coming to work and what are you willing/not willing to do to provide that?
  • If your best employee quit today saying that they found another job that was “more aligned with their passions,” how much monetarily would that cost your organization? What if your top 3 performers left in the next 12 months?

Attracting and Recruiting Staff

  • What has your organization done recently that has brought it some good press? Is it an organization that people want to work in? What does it mean to your organization when the answer is “no”?
  • What have you done for your employees recently that has them talking to their friends and family about how great of a workplace they belong to?
  • What makes your organization attractive to potential new employees? Is it your fantastic compensation package, unique culture, or particular niche in your industry? If you have no answers, you are probably not attracting the cream of the crop that will help accelerate your growth into a new horizon.

Managing Change

  • Measure the percentage of people in your team that is on board with all the changes that you are planning this year. What if I told you that you could make that much closer to 100%? How could you make that possible?
  • Do your key leaders have input into determining the changes that are coming down the line? How would it transform your organization if they did?
  • What changes have you left by the wayside because the topic was too emotionally charged? How much is that affecting the bottom line?

Planning for Staff Succession

  • Do you currently have a clear plan for coverage when major illness happens or if someone were to go on a 3-week vacation? What happens to your productivity during those times?
  • Have you identified up and coming leaders and begun a development plan for each of them? How much money will you save in efficiency and productivity if a smooth succession happens should someone choose to leave?
  • Have you identified a key leader in your organization that you can entrust your business to when you need to unplug for a vacation or rest? How much longer can you do this before you burn out? What will that cost your organization?

Managing Staff Performance

  • How much does it cost per month when your team misses a deadline? How does it affect the longevity of your client relationship?
  • How much time is lost due to tardiness in your organization? Extrapolate that calculation towards labor lost over the whole year? Do you now feel greater urgency to address the issue?
  • Perhaps you generally have a great team but you have one bad apple that drains the energy from the team and debilitates chemistry. What is the cost to the rest of the team when you don’t address the bad apple’s performance issue? Extend those calculations to the domino effect it has to your clients. How grave is the issue now?

Remember, the principle is that the more time we spend in preparation and planning, the less time we will spend fixing emergencies. Do the math, because it almost always makes good business sense to focus on any of these areas and you will ultimately reap the rewards as your business thrives and the quality of life for your team improves. Ignore these issues at your own risk and then prepare to go through the lengthy, and extremely costly process, of rehiring and retraining new people.

Imagine life where you no longer had to repeat these dreaded life cycles in your business and then think about how much more capacity YOU will have for work that is far more relevant for the growth of your organization.

Building Strong Teams – Part 2: Managing High Performance

As you build your business online, you have probably thought about how to improve the performance of the current team that you work with.  Whether you have two employees or two hundred, this series aims to equip you with common sense but not necessarily common practice tools.  This week, I will be blogging about the second step of building strong teams: how to keep your team at peak performance!

Part 2: Managing High Performance

Annual Reviews: Most established organizations have an annual review process that normally coincides with a salary evaluation.  If you do not have annual reviews, you need to consider the cost to your team; however small it happens to be.  The common misconception is that annual reviews are not necessary for small teams, because “they already know what I think of them.”  This couldn’t be further from the truth.

At minimum, annual reviews are a great time to recap the year and discuss what went well and what opportunities came along with your successes.  It is customary to discuss not only a broad view of the organization’s achievements but to focus in on the individual contribution of the employee.  In low trust environments, you will typically see a report card type of review — where a lengthy list of responsibilities is weighted against a measurement scale that attempts to give the employee feedback about their value to the company.  In my experience, these types of reviews are not very engaging to the manager and frankly not much fun for the employee either.  However, its better to have an annual record of such conversations rather than have nothing at all.

Ideally, feedback about an employee’s progress (good and bad) should be presented to them far more regularly than on an annual basis.  If you are not giving feedback weekly, and at minimum, monthly to your employees, you are not setting them up for success.  The pace at which our competition is moving warrants responsible managers to move swiftly to correct inappropriate behavior that detracts the organization from reaching its goals.  Remember the rule: offer one negative feedback for every five positive ones you offer to your employees.  This will help you grow your emotional bank account with your team, and help make your negative feedback hold much more weight.

With this practice in place, you may ask then, what would be the point of an annual review?  Good question.

  1. Highlight the year’s feedback. Since feedback is given regularly, I use the annual review to highlight the best feedback that I have given that employee in the past year and point out some of the more consistent opportunities.  At this point, it should no longer be a surprise to the employee.  In fact, the annual reviews should never contain any surprises or unknowns to the your people.  A review of past conversations helps to frame the context of the annual review.
  2. Talk about what engages your employee. With feedback summarized quickly in your meeting, start talking to them about the best parts of the past year.  You’ll soon find them talking about the work and responsibilities that excite them and bring purpose and passion to their role.  You may even be surprised that the best part of their year was being called ad hoc into a committee that ordinarily had nothing to do with their role.  Listen carefully to what their heart is drawn to.  This is where you will find their engagement to be at highest level.  As much as the business allows, talk about how you can give them more opportunities to pursue more work that brings them alive. Be sure to also check in on the tasks and responsibilities that drain your team. You may not be able to change the scope of the responsibilities but just being aware of it and offering them a chance to be heard is a valuable exercise in and of itself.
  3. Consider the partnership approach. All in all, it’s important to hold the perspective that your employees are partners with you on your organizational goal, rather than employees that need to be micromanaged towards the results that you determine.  Don’t get me wrong, give regular feedback, but in your annual review, make it a time where you give the gift of true listening to your employees.  You will be amazed at how much their engagement levels will change when they feel like they are understood and supported; even if their actual duties don’t change much.

Invest in your Leaders: If you have a larger team, you probably realize that it’s impossible for you to keep track of all the day-to-day operations of your business unless you appoint leaders that manage a segment of the business.  If you have a large team with direct reports who are managers, it is wise to spend the majority of the time allotted to personnel issues with your leaders.  I have an open door policy where any employee can approach me for any reason.  However, I typically initiate and make sure that I spend a good chunk of time connecting with my managers.

  1. Connect intentionally. In these regular meetings, I use the same discussion process as the annual review but in a much more simplified fashion.  First, I review high-level priorities.  At CityMax, I am privileged to work with a wonderful group of managers, so I am usually doling out compliments whenever I remember to.  I affirm all the great qualities that I appreciate and I thank them for the great results they have shown. Next I discuss how their energy level is with their current load of responsibilities and do the best I can to alleviate any stuck points or hindrances.  Lastly, I hold the perspective that we are partners, and consistently ask them for feedback on my performance as well as anything that I can do to help them do their jobs to their best level.
  2. Listen carefully whenever your leaders give you feedback about yourself because there is usually more underneath a meek offering that you can learn about yourself and how you can be a better support to them.  As much as possible, involve them in major decision making processes and consider their concerns with the utmost care.  I firmly believe that leaders ignore their manager’s opinions and suggestions to their own detriment.  In a spirit of partnership, the less you treat them as underlings, the more engagement you will see as they not only interact with you but with the people that they lead.
  3. Be a resource. One of my worst career experiences was when I was starting out in business and was working for a prominent retail chain.  As was common, there were management shifts that caused me to have a new boss.  This manager would speak down to his people disrespectfully and every week he would assign work to his people that far exceeded a reasonable completion time.  Imagine if your boss asks you to finish a project in a week that would normally take two weeks… and then did absolutely nothing to help you.  Nobody wants to work for a tyrant and no one will respect your leadership unless you show your people that you truly care about their well-being.  Jim Collins in the influential management classic “Good to Great,” writes that the most effective leaders leading today’s most successful companies have a deep humility with the people they work with.  So consider being a resource to your people instead of only simply being a delegator.
    1. Ask your managers if you can shift around organizational and people resources to help supplement capacity for large undertakings and urgent tasks.  Always ask if you have done your part in providing the best environment for them to succeed.
    2. Find ways to provide educational resources that can help your leaders grow professionally and personally.  This could be supporting a portion of their tuition as they pursue a professional certification, or simply paying for the cost of a conference that would refresh their relevant work skills.
    3. Just because you’re not in it for the money, doesn’t mean that your people don’t care either.  As much as possible, find ways to financially care for your leaders.  It’s not easy to justify paying a premium for good work but consider the loss of productivity should a key person leave.  Think about how expensive it would be to firstly find a person of similar qualifications and knowledge base about your business and then ask yourself how long it would take a new person to pick up where the other one left off.  I think you see where I am going with this.  The worst feeling for an employee is to give up hope that they will reach their financial goals with their current employer, find new work, give notice, and THEN find out that the current employer is willing to give them a substantial raise to stay. “If you are willing to pay me that much now, why have you held back all this time?”

    If you take care of your leaders, you will find that the investment more often than not will only benefit the stability of your organization.  Remember to connect intentionally with them, listen carefully to their feedback and always find ways to be a resource to them so they can be freed to focus on getting the bottom line results you need to see your organization thrive.

(Darrell Lim is our Operations Manager at CityMax but he is also a trained organizational development coach.  Find out more about him and get more business insights at his CityMax powered business website: