Small Ideas Are Big Hits
Many companies try to encourage suggestions by offering big-money rewards for the best ideas. RLI Insurance in Peoria, Ill., found that those prizes can discourage the small suggestions that really add up. "If we allow only home runs, we won't get many suggestions," says Cindy Brassfield, who coordinates the recognition program. "But if we allow smaller hits, we'll get the runs."
At RLI employees submit ideas to Brassfield over the computer network. (For another take on the use of E-mail, see In the Office, [Article link].) Suggestions must be constructive, and they may not be submitted anonymously. Brassfield sends each idea to the lowest-level person who can accept, decline, or further consider it. RLI tries to respond to each idea within three working days, though that has proved difficult.
Brassfield has compared the response rate with benchmark models (see below) and says, "We're blowing them away." Of the 340 employees who were eligible, 291 submitted a total of 1,319 ideas in 1992. Brassfield keeps every idea in a database, so she knows, for instance, that employees are submitting fewer ideas than in the beginning, but they're better ones.
RLI does award modest prizes: every idea, implemented or not, earns a $2 bill -- a token just big enough to show RLI's interest. Employees whose ideas are used enter a quarterly drawing for prizes that range from $50 to $100 in cash.
The employee task team that put together RLI's program found through research that employees value recognition more than cash prizes. RLI emphasizes the former by certifying ideas, implementing them quickly, and praising the employees who contribute them. Anyone who submits a suggestion that saves at least $20 a day, or $5,000 a year, or submits five or more usable suggestions joins the "all-star" team, which is recognized at quarterly companywide meetings.
Steve Pipp, an investment supervisor, made the all-stars early on, after suggesting that RLI renegotiate its contract with the bank that holds its securities. The bank added several time-saving services and lowered its prices, saving RLI $145,000 that year.
If Pipp is RLI's home-run king, underwriting assistant Cindy Suelter is its queen of runs batted in. She has made 49 suggestions since last November -- coming up with, for instance, ideas to help eliminate several paper forms and save the data electronically. Although no one idea has saved thousands, all the ideas add up. "The two dollars isn't it," says Suelter, "it's the opportunity to feel like a part of the company. I've never been so recognized in my life."
RLI measured the success of its suggestion program with the help of materials provided by the Employee Involvement Association (EIA; phone: 703-524-3424), in Arlington, Va. EIA publishes an annual statistical study of its members' programs. The cost to nonmembers is $100. The study is available free to members who respond to the survey and for $35 to members who do not respond. (Membership costs $220 annually.)* * *