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Relating to staff like customers

The following article was published in the Singapore Straits Times

Have you noticed how the word 'Loyalty' has undergone a redefinition over the past few years?

Changes in definition

Organisations used to measure loyalty in their staff by years of service. Ten years with a company was rewarded with a pencil, twenty years earned a pen and thirty years a dinner. Now loyalty is measured by performance with a thirty day service employee potentially more loyal than a thirty year person.

This shift in definition is occurring in other aspects of our lives, too. In the old days we probably would only have shopped in one department store, flown with one airline and banked with one bank. We would have used one doctor, one school and one restaurant. Nowadays, partly because of the ease of transport and more available information, customers look around for the best deals and have several store loyalty cards, defeating the intention of tying us to one shop as our parents would probably have been. We collect frequent flyer points with several schemes and the average Singapore woman has six credit cards!

Some people are now even extending this way of thinking of loyalty to their husbands or wives!

In investments, shareholders buy and sell overnight to make quick returns, often with little interest in the company concerned. Businesses are merged and acquired nationally and internationally so often that it is sometimes hard to know who the current owners are or in which country they are based.

In employment, the old assumption was that people would want to join and stay with the company for life. Every year's service was rewarded with an annual pay increment. Appraisals discussed career ladders within the company and usually told the staff member to hold on for (yet) another year. And staff had to do something pretty terrible to actually get fired.

What is now expected

Now loyalty means performance. There is performance related pay for individuals. Appraisal systems identify the worst performing ten per cent of staff with a view to dismissing them and National Wages Council advice is to cap the difference between what an older worker and a new employee are paid for doing the same work. Increasingly, jobs are being offered on a contract basis for a specific period with a renewal option based on performance.

Gone is the long term induction and acclimatisation programme. Now new starters are expected to ‘hit the ground running'.

But as employers adopt the performance definition of loyalty, they also need to consider the implications on how their staff will react and how they should be managing them.

People frequently now join a company with an aim of adding to their skill set and their market value and having a creditable addition to their CV. They will happily contribute ideas, energy and long hours but only where they experience reciprocation. They will stay with the company for as long as it still meets their needs. When that ceases, they will leave for seemingly more attractive pastures. The good staff will quit and leave the company by getting jobs elsewhere; the bad ones will quit and stay, only being present physically, not mentally nor emotionally. They will be counting the days till retirement, only to find that that date is being moved further away!

If companies measure loyalty in terms of performance – so will the employees.

So what should organisations and leaders be doing to meet these changes?

Managing staff like a customer/supplier relationship

Perhaps the time has come to start thinking of the relationship with staff as one between customers and suppliers, exchanging services. Whilst both parties are achieving what they want, it will be mutually advantageous and in everyone's interest that it continues. Sales and marketing people know that customers usually buy relationships before they buy products and services. If the price is bargain basement low, they might make a one-off purchase but probably will not come back. The experience has to be enjoyable for repeat long term business.

Leaders need to view their staff as partners rather than subordinates, recognising and liberating their talents. They need to be agreeing flexible working and reward arrangements rather than being locked into universal and unilateral pay systems for all employees and they need to be appreciating that their role is to build upon the goodwill of their people rather than just ensuring that they conform to the rules and procedures.

Liberating talents

The Singapore Government is investing huge resources into creativity, through training and the recruitment of foreign talent, correctly recognising that Singapore cannot compete in labour intensive industries and that the national future is to become leaders of excellence in brain intensive businesses. Yet some managers still resent staff proposing new ideas and see it as a criticism of their abilities as seniors not to have thought of the notion themselves. Some people feel that they will even be penalised for making suggestions that will help their company to move forward! Most staff have immense talent just waiting to be identified and nurtured.

Flexible working arrangements

Every staff member is unique, they have different talents, different aspirations, different needs and different motivations and even these will vary at different phases of their lives. Good marketers identify the needs of their customers and their suppliers and work with them to design mutually agreeable terms. For some staff this could be money, for others times of work, places of work, learning opportunities, overseas postings or chances to steer their careers in certain directions. The best managers discuss these issues regularly with their staff and find ways of designing mutually beneficial options.

Maintaining goodwill

As organisations alter so frequently and corporate cultural changes make them unrecognisable from the same company of a few years back, staff are ceasing to be loyal to the corporation. The name might be the same, but the character of the business is not. Staff are switching their loyalty from an organisation name to an identifiable human being, usually their manager. A good manager has their team following them to the end of the earth. A bad manager is the constant subject of discussion in that Friday evening, end of week, letting off steam session in the restaurant or the pub.

Observers of the English Premier League will notice that a football manager will often sign players from their previous club and when they join another team they usually take their whole coaching staff with them.

When good managers resign they take their best staff with them and leave the worsts ones behind.

It is also well recognised that the way the staff are treated by their managers, be that well or badly, will be mirrored in how the customers are subsequently treated by the staff.

The days of the top down, hierarchical, autocratic management style are long past. The best staff have their own personal demands and they have the initiative, the skills and the mobility to achieve them. The best managers are now managing the relationship not the staff.