A noted CEO tells readers there is only one way to know how morale is at your company: ask the people who work there.
There's only one way to know how good morale really is in your company: ask the people who work there
I always find it interesting that so many managers believe you can't measure morale. We encourage people to quantify, analyze, and improve every other aspect of the business--from customer service to productivity to return on equity--but employee satisfaction is supposedly an intangible, something you can't put a number on or give a score for.
That notion is not only wrong but dangerous. What gets measured gets done. If you don't measure morale, you wind up taking it for granted. You don't focus on it. So you miss the opportunity to fix problems easily and inexpensively. Instead they just sit there and fester, hidden from your view.
The challenge, of course, is to figure out how to measure morale. We'd been tracking it for years at Springfield Remanufacturing Corp. (SRC), using polls, suggestion programs, and the like, but we'd never been able to come up with a system that allowed us to measure it in the same way that we measure, say, inventory accuracy.
Then, about a year ago, one of our subsidiaries was invited by Inc. and the Gallup Organization to take part in a survey for Inc.'s 1996 State of Small Business special issue. Participants were asked 34 questions that probed how they felt about their jobs, their working conditions, and their employers. (For example, "At work, do you have the opportunity every day to do what you do best?")
The results were interesting enough that we decided to do a survey of our own, using 14 of the questions in the Inc./Gallup poll, modified slightly to eliminate ambiguities. We then distributed the new questionnaires to all the other subsidiaries and asked people to fill them out anonymously--at work--and turn them in.
The responses floored many of our managers. Our Heavy-Duty Division, for example, came in with abysmally low scores on three issues. People were asked to agree or disagree with the following statements:
In our survey of Heavy-Duty, 43% of the people disagreed with the first statement, 48% with the second, and 62% with the third.
Now, you have to understand that for years Heavy-Duty has been the crown jewel of SRC. The plant it operates from is the one we started with, back in 1983. Many of the people who work in that plant have been with the company since the early days. Some of them have substantial equity stakes.
And Heavy-Duty was successful. It was not only our largest subsidiary but also our most profitable and our safest, at one point running up more than 1.75 million consecutive hours without a lost-time accident. To all appearances, morale was great, and employee involvement was high. We'd been holding shop-floor meetings in the plant to review the numbers every week for more than 12 years. Most of the managers, moreover, had come up through the ranks.
So how could it be that a substantial minority believed that their opinions didn't count? How could so many think they had no chance to become leaders?
The managers of Heavy-Duty decided to find out. They set up an employee-satisfaction committee and asked for volunteers. Eighteen people were selected, including a crankshaft grinder, a guy from cylinder heads, a buyer, an engineer, an accountant, you name it. Every department and all three shifts were represented. The committee's mission: to improve the division's scores on those three questions the next time the company did the survey.
It didn't take long to start finding out why the scores were low. One committee member said that, as a matter of fact, he didn't think his opinions counted.
"Why not?" the others asked.
This guy works in the dynamometer room, testing products before they get shipped. Every time he received a fuel-injection pump, he said, he had to change the setting because the specifications in the pump room were different from those in the dyno room. He'd been complaining about the discrepancy for two years, and nothing had happened. Apparently, his opinion didn't count.
The problem was fixed the next day.
His situation was typical. It soon became clear that we didn't have two or three big problems in Heavy-Duty. Rather, we had loads of little problems, most of which could be solved quickly and inexpensively just by bringing them to the surface and focusing on them.
You might wonder how we'd missed them. The truth is, those types of problems are easy to miss, especially if you're doing well. Why? Because to be an effective manager, you have to follow certain routines. You have to make sure you have good systems in place, and then you have to stick with them, day in and day out. The danger is that after a while you'll stop thinking about them. You'll forget to check them. You won't ask whether they're still serving their original purpose.
It's a trap that even the best managers fall into, and believe me, the managers at Heavy-Duty are first-class. The only way to avoid it is to conduct audits from time to time. You have to develop the discipline of going back periodically to take the pulse of the organization, to find out how people are feeling, to check how you're doing.
We intend to use the survey as our audit. We'll do one every six months throughout the company. The point is not to judge our managers but rather to set benchmarks we can continually improve upon. We'll use our scores to track our progress, just as we keep score in every other aspect of our business.
Only time will tell how successful we'll be, but at least people have the tools they need. "Boy, it's nice to have something to measure," said the general manager of one subsidiary. "Before, I was just going on gut feeling. Now I have a baseline to work with. I can do something with that."
I'm sure he will.
Jack Stack is the CEO of Springfield Remanufacturing Corp., in Springfield, Mo., and is the author, with Bo Burlingham, of The Great Game of Business.
Contributing editor JACK STACK is president and CEO of SRC Holdings Corp., based in Springfield, Missouri. The company's innovative style of open-book management -- financial information is shared among managers and employees -- is summarized in Stack's book The Great Game of Business, coauthored with Inc. editor at large Bo Burlingham.