A friend of mine and I were working toward a model that paid a percentage of everything in excess of the required man-hour rate, but his operation runs at a loss in winter to keep his team employed, so the overage earned in summer is used up then- it doesn’t feel like a bonus, but is in a way. I wonder if the bonus was paid during summer so the team had to put away the same way the owner does, would the bonus be felt, and would a better grounding in the business help morale or hurt it?
Another thought I’ve been chewing on recently is why people don’t join teams. I believe the newer blood in the workforce is looking for a growth plan. Most service industry looks like a dead end job unless you have owner hustle, which is why top talent always leaves, because they have owner hustle. There are plenty of talented people out there who will work a plan if there is a clear plan to work. Instead, both sides (onboarding employee and employer) are waiting for the other side to make a move. A clear growth plan communicates expectations, realities of the business, where the company is going, opportunities available as the company progresses, when milestones should be achieved and what the compensation will be for each milestone. One company that I’m somewhat familiar with hasn’t had turnover in four years. When I asked one of the leaders what contributed to this statistic, he said, “when we bring people on, they can see...”. His company casts clear vision that turns a job into a career path.
Thoughts?
There’s a lot in your post there, but overall I agree. For sure, top talent often leaves because they have that hustle and want to be rewarded for it. The way I see it, we can either be the company they leave, or the one they go to. We want to be the company they go to, hence things like the offering we are putting together. A friend of mine recently did it with his mechanic shop, and it has worked out very well. It rewards everyone for hustling, and while there’s not a bonus every month, there is most months.
The premise of this system is that everyone is treated like an owner, to an extent, so that they all will buy in. Sure, some may not, those who just want a paycheck for minimal effort - with this model, the rest of the crew will likely push them out for not pulling their weight they way they should.
I also agree that a clear path of advancement is a huge driver in retainment; we are putting together a payscale sheet that takes away all the mystery of pay rates so each crew member can see what he’s earning and why, and what he has to do to earn more. It will be posted publicly for the crew, so nobody will question their rates or anyone else. I believe that will help too.
Finally, getting the employees to buy in is the key, which means treating them with respect and showing them they have real value. Little things make a big difference there, just listening when they have complaints or ideas and correcting those things when possible, and explaining when not. I make it a point to try to buy anything a crew wants to make their jobs easier or more productive. If we can’t buy it, or don’t want to, I will explain why so that they understand, and the that’s made a big difference too.
Also, I tell the employees that this is really their company, and I’m just there to manage it for them to guide everyone and keep things going smoothly. It’s true too, without the production staff there would be no company, I would just be a guy with a chainsaw.
