The Winning Manager eNewsletter April-May 2009

THE WINNING MANAGER

Putting People First

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Editor: Dr. Wolf J. Rinke
Publisher: Wolf Rinke Associates, Inc.
(c) 2008 Wolf J. Rinke
Vol. 12 No. 2, April-May 2009
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1. NEWS YOU CAN USE
2. MONEY SAVING OFFER--FOR SUBSCRIBERS ONLY
3. HOW TO AVOID FUTURE LAYOFFS
4. HEAR WOLF HOWL--I MEAN SPEAK
5. HUMOR BREAK
6. ABOUT THE EDITOR
7. PRIVACY STATEMENT AND SUBSCRIPTION INFORMATION

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REALITY CHECK
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"You achieve a long-term competitive advantage through people, not by getting rid of them."
-Jeffrey Pfeffer

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1. NEWS YOU CAN USE
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WANT TO REDUCE COSTS-JUST ASK
Okay you've heard me talk about it before (see Winning Mgt eNL 11-5: How to Improve Productivity During Tough Times), but here is proof that something so simple can have huge payoffs. Beth Israel Deaconess Medical Center was facing a $20 million loss this year (2009). The executive team concluded that the only way to achieve that was to layoff about 600 employees. After volunteering to reduce his own pay by 10% CEO Paul Levy tried one more thing. He asked all employees for help and ideas to reduce expenses. Within a very short time employees came up with enough ideas, such as giving up part of their pay, taking an extra non-paid day off, reducing bonuses and many other cost saving initiatives that resulted in enough savings to spare 450 jobs.

ACTION STEPS
If you need to reduce costs-and who doesn't in these tough times-lead by example and then ask your team members for ideas and suggestions. I can guarantee you that the results will totally astound you.
Source: K. Cullen, "A head with a heart," Boston Globe, 3/12/09, http://www.boston.com/news/local/massachusetts/articles/2009/03/12/a_head_with_a_heart/; and B. Williams, "Hospital, heal thyself," NBC Nightly News, http://www.msnbc.msn.com/id/3032619/#30019445

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2. MONEY SAVING OFFER--FOR SUBSCRIBERS ONLY
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Use the coupon code: CPE4142009 to SAVE 5% on ALL of my high impact products at www.WolfRinke.com. Hurry coupon expires 5/15/09.

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3. HOW TO AVOID FUTURE LAYOFFS
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In the Dec/Jan issue of this eNL (11-6) I provided you with five ways to downsize "lite":
1. Transfer jobs
2. Establish alliances
3. Cut pay across the board
4. Encourage phased retirement
5. Provide for early retirement and voluntary severance
In this issue I am encouraging you to begin the strategic process of changing your human resources paradigm by implementing four strategies that are designed to prevent future layoffs. (That's right, I'm thinking ahead, because, believe it or not, this recession, like the other 11 we've had since WW II, will end, and we will come out stronger than ever before.)

1. Implement an effective performance management system
Your employees are assets to be deployed, not costs to be cut. (See the Insight Break above.) That's why you need to evaluate your business plans and your employees' performance on a regular basis to make sure that people and organizational requirements are aligned and that all employees are adding value. At least twice a year you need to identify your "A", "B, and "C" players, so that you can provide "A" team members-that's your "water walkers"- with ever increasingly challenging assignments and "B" players"-average performers-with continuing education, training and development to help them be the best they can be. Your "C" players-marginal and poor performers-who add little value and are not interested or able to move themselves into the "B" category need to be asked to leave. (Both you and the employee will ultimately be much more happy and productive. See my article "Getting fired is the best thing that can happen to you at www.WolfRinke.com.") If you aggressively manage your people this way you will dramatically reduce the need for future layoffs.

2. Install a performance based compensation system
A well designed performance based compensation system with a relatively small base salary and generous performance incentives tied to individual, team and organizational performance will align your labor costs with your organizational performance and reduce the need for layoffs in the future. An example of such a system is one developed by the steel manufacturer Nucor Corporation, where front-line employees work in self-directed teams of 20-40 people which are compensated as follows:
- Hourly base pay is 25 to 33% below the industry average.
- A bonus of 80 to 200% of base pay is paid weekly to all teams that meet or exceed productivity goals. Productivity rankings are posted daily.
- Employees who are five minutes late, lose their bonus for the day. Those who are 30 minutes late, lose their bonus for the week.
- Products returned for poor quality result in a proportionate decrease in bonus pay.
As a result Nucor is more than twice as productive as their competitors. Specifically Nucor produces a ton of steel in 45 minutes versus three hours for the big steel makers. And, here comes the big one, Nucor's employees are paid 60 percent more than other employees in the industry.

3. Install an "entrepreneurial" culture
In this era of intensifying global competition this strategy is the most powerful. It is simply no longer reasonable to give your employees the impression that they have permanent job security. By the same token it is equally unreasonable for you to expect long-term loyalty from your team members. Instead an entrepreneurial culture maintains that you (the leader) form a partnership with your team members, where you provide employees an opportunity to apply their skills, talents and abilities for which they are compensated provided they achieve specific goals that add value and contribute to the bottom line. To make sure that the partnership continues to be mutually beneficial, you must provide your team member with lots of opportunities for growth and achievement which in turn improves their productivity and their ability to be a highly thought after resource even in tough times. This causes your team members to stick around. The partnership ceases to exist when it is no longer rewarding or profitable for either party, at which time the "entrepreneur" moves on.

4. Make greater use of "just-in-time" employees
The increasingly cruel competitive economy will require you to make greater use of consultants, independent contractors, temporary employees, and outsourcing-a "just-in-time" (JIT) workforce that can more easily expand or contract to meet your current needs. For example, of the 900 employees at the Hutchinson Technology plant, makers of disk drive components in Eau Claire, Wisconsin, a full twenty percent are part-time and temp workers. In addition, when demand for their products increases-which doesn't happen very often-full-time employees are asked to work overtime, which allows the company to flex-up so that they can stay competitive. And of course if demand dries up, so typical for lots of companies during this recession, your JIT team members can be let go without steep costs to the bottom line.

SOURCE: Based in part on "Don't Oil the Squeaky Wheel and 19 Other Contrarian Ways to Improve Your Leadership Effectiveness," Ch. 18, available at http://www.wolfrinke.com/squeakywheel.html.

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4. HEAR WOLF HOWL--I MEAN SPEAK
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4/16/09 Woodward, OK "Winning Management: Building a High Performance Workplace," Seminar, Melinda Brock, www.Wodwardhospital.com.
5/8/09 Grand Rapids, MI "Positive Attitude--The Key to Success", Opening Keynote, MDA, contact Susanne Consiglio, mda.execdir@sbcgloabal.net.

These full day seminars maybe open to you if your company is a member of the Institute of Management Studies (IMS). Contact the chairperson for specifics.
Winning Management: Building a Peak Performance Workplace
2/27/09, Washington, DC, contact: Jim Henderson, washingtondc@ims-online.com
Increasing Your Personal Effectiveness
9/21/09 London, England, contact: Mike Matthews, london@ims-online.com
9/22/09 Edinburgh, Scotland, contact: Graeme Crawford, scotland@ims-online.com
9/24/09 Manchester, England, contact: Gareth Morris, manchester@ims-online.com

NOTE: I have other "in-house" presentations scheduled. Please let me know if you are interested to preview me or bring me into your organization at reduced expenses when I'm scheduled to be in your area. That way we can let you know when I'm coming your way!

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5. HUMOR BREAK
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A priest offered a nun a lift in his car. She got in and crossed her legs, forcing her gown up to reveal a leg. The priest got all shook up and almost had an accident. After controlling the car, he stealthily slid his hand up her leg. The nun said, "Father, remember Psalm 129?" The priest removed his hand. But, changing gears, he let his hand slide up her leg again. The nun once again said, "Father, remember Psalm 129?" The priest apologized:" Sorry sister but the flesh is weak".
On his return to the church the priest rushed to look up Psalm 129. It said, "Go forth and seek, further up, you will find glory."
Moral of the story: If you are not well informed in your job, you might miss a great opportunity.

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6. ABOUT THE EDITOR
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Dr. Wolf J. Rinke, CSP is a highly effective management consultant and executive coach who specializes in building peak performance organizations, teams and individuals. He is the author of 14 books including "Don't Oil the Squeaky Wheel and 19 Other Contrarian Ways to Improve Your Leadership Effectiveness" and "Winning Management: 6 Fail-Safe Strategies for Building High-Performance Organizations" available at www.WolfRinke.com. Wolf is also an internationally recognized management/leadership keynote speaker and seminar leader who delivers customized presentations that combine story telling, humor and motivation with specific "how to" action strategies that participants can apply immediately to improve their management and leadership effectiveness. Preview a live demo at www.WolfRinke.com. To take advantage of Dr. Rinke's services contact us at 800-828-9653 or WolfRinke@aol.com

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7. PRIVACY STATEMENT AND SUBSCRIPTION INFORMATION
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