Driven to change: Pep Boys’ new talent strategy boosts profits

Sometimes the road ahead requires a different kind of driver.

Back when Pep Boys was approaching its 90th anniversary, the Philadelphia-founded automotive services company embarked on intensive efforts to craft a new strategic plan. Although Pep Boys had become a multi-billion-dollar operation with more than 800 stories across the U.S. and Puerto Rico, company leaders believed they needed a deeper understanding of their position in the market, the needs of their customers and the service strategies that would optimize Pep Boys’ profits.

“The Road Ahead” initiative convinced executives to make a strategic shift in corporate culture. Rather than focus on providing the lowest prices to customers, Pep Boys needed to provide customers with a higher level of knowledge and assistance. “We don’t sell, we solve” soon became a company mantra. To fulfill that promise, however, Pep Boys would have to adopt new approaches to recruiting and training.

The company identified the skills and traits employees would need to thrive in the new culture, then retooled the careers section of its website to succinctly describe and attract desirable candidates. Adorned with a photo of a slick, black car, the page asks “Are you built this way?” Pop-up boxes explain how certain skills and behaviors – such as perseverance, creativity, customer service, continuous learning, performing under pressure and being a team player – are as essential to Pep Boys operations as brakes, oil, tires and a smooth-running engine are to any automobile.

The company also rolled out a program of ongoing and tailored training for both new hires and existing employees. It expanded and updated in-house training programs to reflect its new culture. Through in-person and online lessons as well as on-the-job coaching, the program covers onboarding, product knowledge, automotive theory, technical skills, information technology, finance, and company-specific systems.

The training also encompasses, customer service, time and stress management, and leadership development. The results of embracing a new culture and developing a talent force to implement that culture have helped converted stores experience double-digit sales increases, despite the tough economy.

Culture Clash: Don’t let corporate culture issues derail your merger

Corporate culture may be a soft concept, but some days it packs a very big punch.

Consider the impact of corporate culture on mergers. In the rush to complete due diligence and seal the deal, few companies conduct a cultural survey of both legacy firms and develop plans to effectively blend the two cultures. Fewer still delay, alter or abort mergers based on findings that cultural differences could jeopardize the deal’s success.

Yet studies show roughly 75 percent of mergers fail to meet financial performance expectations. And, executives often point to incompatible cultures as a prime cause of those financial shortcomings.

Mike Monahan – who executed nine mergers and acquisitions as CFO of the private equity firm, PetroChoice Holdings and now serves as the CFO of NutriSystem, Inc. – offers some advice on how to prevent corporate culture from derailing your strategic growth plans.

Setting clear business goals for the merged company and quickly showing progress in achieving them is essential to creating an effective culture and a successful merger, Monahan says. That focus helps employees understand their role in the merged company and the reasoning behind its culture, and fosters confidence that the company is capable of achieving its goals.

Leaders of the merged company need to be dedicated communicators. During its acquisitions, PetroChoice implemented several communications practices – including weekly e-mails about company accomplishments, annual meetings and travel schedules that gave company leaders face time with employees in distant offices – in order to discuss merger benefits, address operational issues, and keep morale high.

Finally, leaders of merging companies need to be willing to adjust their expectations for the new corporate culture even after the merger is complete.

“You have to be willing to be flexible after the deal closes, and open to new ideas because it’s impossible for both companies to fully know each other and their strengths and weaknesses until you merge,” he said. “There are always surprises. We were most successful when we had the right leaders who were flexible, open-minded and respectful of the different partners. In those situations, you end up getting to the right place, even though it may not be exactly what you outlined at the outset of the merger talks.”

Corporate Social Responsibility Programs

Fostering “impact careers” to benefit your company – and the world!

As competition grows for top talent, companies are realizing that one of the most compelling things they can offer talented workers is the opportunity to create an “impact career.”

Beyond competitive compensation and professionally satisfying work, many workers want their jobs – and their employers – to have a beneficial impact on the world. In one a Stanford University study, MBA graduates expressed a clear preference for jobs at socially responsible companies—and reported they would sacrifice an average of $13,700 in salary to join such companies.

Many companies are working to satisfy that desire through Corporate Social Responsibility (CSR) programs. Many programs, however, aren’t thoughtfully implemented and, consequently, aren’t impacting the world as desired or delivering full recruitment and retention benefits.  A few practices could improve that situation.

Crowd source your CSR

The CSR programs which inspire the greatest employee engagement and generate the biggest impact don’t come from the desk of the CEO.  They come from the employees.

Whether you are starting or revamping a program, involve your employees in identifying key CSR goals that fit with your company’s products, operations, markets and corporate culture. Ask employees for ongoing suggestions about ways to achieve those goals and for their participation in putting ideas into action.

Combine training and CSR

Whether your CSR goals involve lowering your company’s carbon footprint or improving working conditions in a developing nation within your supply chain, CSR programs can generate opportunities for employees to tackle different challenges, develop new skills and foster leadership abilities.

Enable employees to step out of their comfort zone and lead a work crew on a Habitat for Humanity house, organize a charity golf tournament or drive efforts to eliminate work-site waste. You will end up with an employee who is more stimulated, more skilled and more committed to the company.

Communicate, communicate

Mentioning your CSR efforts on one page of your website or once in your annual report isn’t enough. Make CSR part of your employment branding and frequent in-house communications. Post updates on your Facebook or Twitter account, your intranet, bulletin boards or company newsletter. Frequent, short communications can sustain excitement and drive accomplishments in your CSR initiatives.

A few thoughtful measures could both improve your impact on the world and make you a more desirable employer in the process.

Employer Branding

Developing an Employer Brand

An accomplished HR professional with such industry giants at DuPont, ARAMARK Healthcare and Teva Pharmaceuticals, Karen Piraino faced a formidable challenge when she became Global Director of Talent Acquisition for a newly formed company with aggressive growth plans.

Executives at DuPont had decided to spin off their performance coatings division – a thriving business with 120,000 customers worldwide and 2012 revenues of $4.3 billion. The Carlyle Group acquired the division, transformed it into Axalta Coating Systems, and launching the Philadelphia-based company onto an aggressive growth track.

Suddenly, Piraino was responsible for efforts to fill Axalta’s corporate offices, 35 manufacturing plants, seven R&D centers and 12,000-member workforce with smart, passionate, fast-moving, risk-taking professionals who could successfully drive growth across 130 countries.

To help achieve that objective, Piraino engaged in employment branding – a tool that is becoming increasingly important and potent in talent searches. Successful employment forges closer ties between a company’s marketing/communications and human resources departments in order to apply the best practices of corporate/product branding to attracting great employees. Together, those departments expand the company’s branding efforts to deliver a “employee value proposition” – a clear and compelling depiction of what employees could expect to get from the company and what they would be expected to deliver as staff members.

At Axalta, Piraino and other executives strengthened their employment brand by embedding it in the company’s overall branding and all corporate communications. To deliver the right message to employees and potential employees, they focused on the company’s core values and the key behaviors desired in its employees.

“Our culture is fast-paced, aggressive, results-oriented, highly accountable, risk-taking but with smart decisions about risk,” Piraino said.

Consequently, any communications related to employment at Axalta – including its corporate web site and product descriptions – began to convey that work culture both through words and visuals.

Developing an employment brand and making it a cohesive component of all corporate communications requires talent professionals to stretch beyond traditional recruiting activities. However, the effort also lets talent professionals tap powerful tools. After all, if branding can fuel enormous demand for Apple devices or other consumer products, it could also spur the best talent on the market to seek positions in your company.

Be Like Facebook

Be Like Facebook: Move Fast and Break Things

For Facebook founder Mark Zuckerberg, rapid, ambitious innovation was so crucial to his company’s success that he began encouraging employees to “move fast and break things.”

Innovation, however, is vital not only to Silicon Valley startups, but to all companies. Analyses suggest that companies that focus primarily on boosting innovation achieve revenues and profits 2-15 times larger than companies that focus on boosting productivity.

Some core practices could enhance innovation within your company.

Collaborate: At its core, effective creativity and business innovation is a team sport. Breakthrough products are not the result of one moment of blinding insight by a singular genius. Rather, innovations are time-honed products of a series of insights, critiques, missteps, revisions and progressively more inventive thinking by clusters of creative, intelligent and focused people.

Fuel that collaboration by forming temporary teams of employees to tackle specific challenges. Design work spaces to encourage impromptu discussions and brain-storming sessions by employees in different divisions. And build a corporate culture that rewards teamwork and collaborative solutions, rather than high productivity by individual employees.

Communicate: Experts urge business leaders to provide feedback on all new ideas floated by employees, recognizing promising concepts, analyzing an idea’s relevance to the corporate mission, and identifying potential problems. Such feedback can come from a designated supervisor, a project team or it can be crowd-sourced through a company’s intranet. Some companies have discovered that online discussion forums and survey tools trigger valuable contributions from individuals who don’t feel comfortable offering feedback during meetings.

Diversify: To be effective in the marketplace, a creative staff also needs to be diverse. Understandably, teams that include individuals of different sexes, races, socio-economic backgrounds, professions, interest groups and mindsets are more likely to recognize a broader range of market opportunities and challenges, and bring a richer spectrum of ideas to the table. A study by the Center for Talent Innovation (CTI) concluded that companies with diverse leadership teams are 70 percent more likely to capture new markets and 45 percent more likely to improve their market share.

Building an innovative workforce requires effort and patience, but it could deliver better business returns than all of our conventional efforts to drive productivity.

Talent Development

A Talent For Growth

Many entrepreneurs insist that one of the most potent business growth strategies boils down to a simple rule: If your want to grow your company, grow your talent.

Building core competencies, problem-solving skills and leadership abilities among your existing staff can bolster the health and growth of your company in countless ways.

Main Line Health Care in Philadelphia has received numerous awards in recent years for its performance, including The Joint Commission’s “Top Performer” status at three of its hospitals. President and CEO John (Jack) Lynch III attributes many of the company’s successes to its rigorous talent development effort.

Leadership training programs have enabled the company to fill senior executive positions through internal promotions and create a pipeline of talent for future promotions. Training about the core competencies of each position and impact of each position on the company has produced performance improvements throughout the system from executives to medical staff to cleaning personnel.

“I am blown away by the impact,” Lynch said.

Some core processes can help any company create a powerful, talent development program.

Define “talent” – Critically survey the full range of skills needed within the firm, including subject-matter expertise, customer service skills, administrative skills, marketing savvy, leadership traits, and so on. That master list can provide the foundation for strategic planning, performance reviews and training programs.

Track performance – Diligently tracking the performance of employees in the core competencies of their jobs will identify weaknesses and training needs, foster accountability among your staff, and show which individuals should be given bigger challenges and opportunities.

Create career plans – Determine how your employees’ ambitions and aptitudes could mesh better with your company’s talent needs and strategic plans. Then work with each employee to map out a professional development plan that could provide the employee with a long, satisfying career within the company while providing you with a steadily more valuable staff member.

Seize teaching opportunities – Education comes in many forms, not just formal classes. Allow employees to sit in on meetings that are above their pay grade but focused on topics they will eventually need to master. Facilitate mentoring, job shadowing, inclusion in special projects or the occasional rotation of responsibilities within your team.

Finally, remember that continuous growth of your company’s talent requires continuous effort. Talent development needs to become ingrained in your company’s daily operations.


Employee Engagement

Get engaged!

Analyses of employee engagement in America are enough to rattle anyone who is managing staff or trying to strengthen a bottom line.

Gallup’s “State of the American Workplace” survey concluded that just 30 percent of American workers feel engaged in their jobs; while Deloitte’s “Worker Passion Report” concluded that just 11 percent of the workforce possess the attributes of a passionate employee. Gallup and other research agencies point to unengaged workers as sources of lower productivity, reduced customer satisfaction, and lower product quality and corporate profits. Gallup estimated that “actively disengaged” workers alone cost the U.S. between $450 billion and $550 billion in lost productivity each year.

With so much at stake, employee engagement is clearly an issue that needs to become a bigger priority in many organizations. But how do you resolve such a big issue?

Foster great managers 

If frontline supervisors and middle-level managers cannot inspire, support and effectively manage the bulk of a company’s staff, there is little that company leaders can do to create a highly engaged and productive workforce.

Hire supervisors and managers with great care, ensuring they possess essential management skills and not just subject-matter knowledge. Provide those individuals with ample training and feedback on management skills, and rate their performance, in part, on the level of engagement and productivity among their employees.

Show gratitude

Employees understandably want to be recognized for their contributions. Frequently and enthusiastically expressing gratitude for great work will both reinforce desired behaviors and motivate employees.

And remember, there are numerous low-cost ways to express gratitude. Gift cards, employee outings, public recognition, thank you notes from managers, new professional opportunities, a bonus day off, or other modest measures can effectively convey a company’s gratitude.

Take small steps

At Fulton Financial Corporation in Lancaster, PA, a string of such small measures successfully supported employee engagement and productivity through an especially challenging period. A three-year effort to replace company’s core system required extraordinary efforts from employees. Fulton responded by expanding employee communications and rewards. It treated employees to parties, wellness programs, luncheons, breakfasts and special events, including a pig roast, barbecues and meals served by managers. Collectively, those efforts helped Fulton complete a daunting project while sustaining high employee engagement.

The list of things any organization can do to boost employee engagement is extensive, and includes expanding training, promoting social interactions and re-assessing work processes. And considering the evidence about America’s problem with employee engagement, it’s more than likely worth the effort.

Written by Alan J. Kaplan, Founder & CEO, Kaplan Partners, November 2015

Workplace Culture

Finding value in bad reviews

Sometimes the smartest thing a business leader can do is embrace the bearer of bad news.

At Analytical Graphics Inc. (AGI), CEO Paul Graziani had endeavored to make his company a great place to work. Company executives had freed employees to take time off to attend children’s concerts or other events. They encouraged employees to contribute to a “super set of ideas” for building the work culture, and reacted to employees’ preferences and needs.

Located in an area with few restaurants, AGI contracted a caterer to prepare free breakfast, lunch and dinner for all employees every work day, and even encouraged employees to fill take-out boxes with supper for their families.

Gradually, the roster of onsite conveniences grew to include car detailing, oil changes, haircuts, a fitness center, a kids’ play room, annual flu shots, massages and even holiday gift wrapping services. Those initiatives, however, didn’t instantly turn AGI into the coolest employer on the block.

Looking back, Graziani says one of the smartest things the company did was start taking ‘best company to work for’ surveys. Results from the early surveys were not complimentary.

Graziani admits that he was surprised “and frankly a bit mad” when one survey showed employees felt they were not sufficiently informed about company activities. Since its early days, AGI had held Storytime – a weekly, all-hands lunch that included 20-30 minutes of employees relating the coolest or most important developments from the previous week. The survey, however, revealed that employees needed more structured communication, especially as the company grew.

AGI executives listened to what employees were saying about the company’s shortcomings and used those responses as a roadmap to make improvements. They instituted quarterly Town Hall meetings to provide thorough overviews of company operations. They also retained perks and practices – even costly ones – that generated clear benefits for the company, such as the catering.

“Getting everybody together in our cafeteria for breakfast, lunch and dinner, exchanging ideas and discussing what is going on in various departments is very valuable to our company,” Graziani said.

Ultimately, those decisions earned AGI a host of ‘best place to work’ awards and helped AGI maintain an employee turnover rate of 3-7 percent in an industry that averages 21 percent turnover.

Written by Alan J. Kaplan, Founder & CEO, Kaplan Partners, 2015

The Servant’s Advantage

Servant Leadership

It may not be the hottest topic in business, but Servant Leadership is generating benefits for many companies.

Robert Greenleaf, an HR professional with AT&T, brought the concept into the business mainstream when he published “The Servant as Leader.” Greenleaf observed that the most effective leaders within AT&T and elsewhere were those who focused on serving, developing and empowering other people.

J.W. Marriott, Sr., founder of Maryland-based Marriott International, insisted that servant leadership gave Marriott a vital competitive advantage: “Take care of your employees and they’ll take care of your customers.” Marriott Sr. created a culture based on teamwork, employee training, internal promotions and “a caring workplace.” He even held regular sessions in hotel lobbies where he met with employees one-on-one and talked them through personal problems.

George Bernstein, President and CEO of Nobel Learning Communities in West Chester, PA, exercises a similar approach to business: “We have always had the philosophy that if you take care of the students, the parents and the teachers, you don’t have to worry about the stockholders … because they will get great returns.”

Bernstein structured the company to provide robust support, professional development and autonomy to teachers and principals. Nobel’s headquarters focuses on lightening teachers’ and principals’ workload by centralizing administrative operations, marketing, recruiting, internal communications, and other tasks.

Nobel conducts regular training and communications with teaching staff to update them on company goals and conditions, learn more about their challenges and aspirations, and lay plans to improve resources and services at Nobel schools. The company also grants principals and teachers autonomy to conduct their jobs in the best ways they can.

Servant leaders say their approach yields concrete business benefits. For example, while employee turnover in American preschools averages 55-60 percent a year, turnover at Nobel Learning Communities’ preschools is just 30 percent.

At MolsonCoors, servant leadership efforts generated improvements in workplace safety. Since 2008, time lost to workplace injuries has dropped 17 percent and the cost of workers compensation claims has fallen 23 percent.

Chances are you already are practicing some servant leadership techniques in your company. Expanding on those practices – including active listening, employee empowerment and strengthening support structures – could improve employee morale, productivity, customer satisfaction and your bottom line.

Written by Alan J. Kaplan, Founder & CEO, Kaplan Partners, September 2015

Balancing Act

Work Life Balance

American employers increasingly need to support healthy work-life balance among their employees. Beyond the mountain of evidence that an overworked, overstressed employee is less productive and more likely to quit, there is also a growing trend among job candidates to assess a company based on the work-life balance it supports. But how can you achieve this elusive balance inside your company?

Flex the clock 

Flexible work schedules have become a core component of work-life balance initiatives, and a highly valued practice among today’s workers. More companies are offering compressed work weeks, job-sharing, shift-swapping, telecommuting, and time off for family needs or volunteer work. Many companies have replaced vacation and sick time with a bank of paid time off (PTO). The practice gives employees greater freedom to manage their time. By limiting the amount of PTO that can be carried over from one year to the next, employers also ensure that individuals take sufficient time off to be rested and remain productive.

Some companies have taken flex time to new levels. For example, one accounting firm realized that many employees’ work was heavily concentrated around tax season. So, the firm offered those employees the option to work a compressed, 11-month year.

Improve time management

Mike Steinerd, Director of Recruiting at Indeed, stressed that good time management is vital to achieving balance. “Work-life balance is often dependent on efficiency and professionalism,” he said. “When management and employees are dedicated to their jobs and work hard during business hours, it gives them the flexibility to maintain a healthy personal life.”

Many companies fuel that efficiency by offering time-management training, streamlining business processes, avoiding extended or unproductive meetings, and even declaring periodic ‘no meeting’ days. When S.C. Johnson tested the concept of no-meeting days, two-thirds of participants said their productivity rose on those days and 16% said their work hours also decreased.

Despite all the pressures facing companies today, it is possible to foster healthy work-life balance—and the benefits to the company can be impressive. After all, a contented, motivated, productive worker is key to all of our success.

Written by Alan J. Kaplan, Founder & CEO, Kaplan Partners, August 2015