Work Environment and Employee Retention

What makes a company a desirable place to work? For many employees, a company's work environment determines whether it's a desirable employer. A work environment is comprised of the atmosphere in which employees work and the attitude a company has toward its employees.
A positive work environment is one of the most important reasons employees stay with a company. If the environment is poor, it's likely people won't want to be there. You can create a positive work environment by following the suggestions provided below.

1. Demonstrate a genuine concern for employees, their families, and their communities.

The first way to create a positive work environment is to show employees genuine concern for them, their families, and their community. No matter what the size of your company is, you can show employees that they're important and valued.
What can your company do specifically to show it cares? It can donate money to community charities, help with employees' needs for child care and elder care, send flowers when a new child is born to an employee or when there is a death in an employee's family, and even hire a masseuse to give employees chair massages during stressful work periods. When companies do these things, employees feel valued.
Working for a company that cares often makes employees feel connected to and proud of their company. Employees may feel there's honor in working for a company that respects people as well as the demands of business.

2. Support a commitment to a work/life balance.

Another way to create a positive work environment is to support a commitment to a work/life balance. There was once a definite line between what was done during work hours and what was done on an employee's personal time. Today this line is blurred. Employees can now do their banking at the office and their work at home.
Employees today work, on average, far more hours than they did 25 years ago. In fact, recent studies show today's workers, especially in high-tech fields, work an average of 60 hours a week.
Supporting a work/life balance means embracing the new realities of the workplace. For example, your may want to ensure that your company sets reasonable deadlines to make sure your employees work an average of 40 hours a week. Then when employees do have to work more to meet a deadline, it's not such a big deal.
Also, be generous with vacation time, holidays, and the number of personal days your employees get. In return, you'll get a dedicated and motivated work force. When a company recognizes and accommodates its workers' needs to balance work and life demands, employees are more loyal and less likely to leave.

3. Provide an appealing physical environment.

The third way to create a positive work environment is to provide an appealing physical environment. There are 120 hours in a five-day workweek. If you account for eight hours of sleep each night, that leaves 80 waking hours. That means that employees spend half of their waking hours at work. And many of today's employees work far more than that. Pleasant surroundings raise the quality of the work experience.
A pleasant environment can be achieved by encouraging employees to "make themselves at home" in their own areas by displaying personal items. The physical environment is also enhanced with windows, good lighting, plants, works of art, and alternatives to cubicles.
Try using low cubicle walls so employees can see one another, and provide common areas in which employees can visit with one another or take a break. Most conversations begin as social exchanges but often return to work-related topics. When that happens, valuable ideas emerge. If not, employees get a needed break.
Also, try to keep your work environment informal, creative, and fun. If possible, opt for a relaxed dress code and provide comfortable meeting rooms. You want your employees to enjoy coming to work.
Think about the companies in which you've worked. Does one stand out in your mind as the all-time best place to work? If so, what made that company better than the others? Chances are you liked being there because of a positive work environment. Remember, having a positive work environment is an important factor in retaining employees.

Benefits and Employee Retention

Is your company an exceptional employer? It used to be that the benefit of working for a company was a paycheck. Only exceptional companies offered health and life insurance benefits. Now employees expect such benefits. Therefore, to be considered exceptional, today's companies have to offer even more extensive benefit packages.
Companies that have generous and flexible benefit programs have lower turnover. So what kinds of benefits should your company offer to recruit and retain employees? Two factors employees look for in companies today are discussed below.

1. A generous benefit plan
The first way to retain workers is to offer a generous benefit plan. In surveys, employees list benefits as one of the most important reasons they stay with a company. Health and life insurance benefits are standard, but to stand out as an employer of choice, your company must ensure that its benefit program offers many options to employees.
Your company's benefits are available to everyone, but not every employee will use every benefit. Having a variety of benefit choices shows your employees that you value each of them. The more benefits you offer employees, the more likely they'll be to stay with you. For example, you may want to subsidize or reimburse employees for child care or elderly care costs, fitness club memberships, or educational programs that enhance an employee's knowledge.

2. A flexible corporate attitude
Another way to retain employees with benefits is to have a flexible corporate attitude. Work is more dynamic and creative than it was 50 years ago. Fewer factory and routine jobs are available. Much of today's work can be done anywhere there's an Internet connection and access to a company's intranet. This means the paradigm of a 9-to-5, Monday-through-Friday workweek is becoming obsolete.
It used to be that a supervisor could look out his office window at 9 a.m. and see his staff busily working. Now a supervisor may see empty desks as employees come in at different hours or work from home on certain days. As the type of work people do has changed, so have corporate attitudes about when and where that work gets done.
More and more employers are allowing for flexible schedules and telecommuting by their employees. Often, employees set their own schedules. Supervisors meet with employees once a week and keep in touch through e-mail. This has meant that management has had to let go of some control and can no longer micromanage, but usually the employees work just as hard—and are often happier.
Many companies are also recognizing the need for their employees to better balance work and life. These companies have accepted the fact that today's workers often value family over work responsibilities. They want employees to satisfy their obligations to the company as well as to their families. Therefore, these companies are willing to allow employees to adjust their schedules so they can meet both demands.
Technology plays a big part in making these 21st-century schedules work. Even when they're away from the office, employees can easily keep in touch with managers and clients using a variety of tools, such as e-mail, faxes, cellular phones, and the Internet. These technology tools enable employees to work seamlessly and meet deadlines, no matter where they are.
Benefits are important to every worker. The more you can offer and fit into your corporate culture, the less likely employees will be to leave for a company that offers better benefits. A generous benefit plan and a flexible corporate attitude are two factors today's employees look for in an employer. Remember, you can retain the valuable employees you have and recruit new ones by offering excellent benefits.

Monetary Compensation and Employee Retention

As the common saying goes, "You get what you pay for." In surveys conducted to determine why employees stay with a company, money is ranked fairly low in importance. But a chance to make more money somewhere else is often the reason many people leave their jobs.
So how much of a factor is money? The fact is that people stay with companies if they feel adequately compensated, even though many say money is not their No. 1 concern. Think about your job. Would you stay if you were getting paid peanuts?
Money is at the heart of the business world. Any strategy for keeping your valuable employees is going to have to involve money. Three effective strategies you can use to retain employees with monetary compensation are discussed below.

1. Offer adequate salaries.
People don't like to talk about salaries, since it's not considered polite. Many people will say, "It's not about the money," when talking about their jobs. However, most people will leave a company if they're offered more money elsewhere. Like it or not, people need money to survive, so paying employees adequate salaries is the first and most important way to keep them.

2. Offer stock options.
Offering stock options is the second strategy you can follow to retain employees with monetary compensation. This is a good way to compensate employees without busting your budget. When employees hold company stock, they're investors, not just assets. Treating employees as investors shows they're valued by the organization—they're not just values to the organization.

3. Offer cash incentives.
The third method for retaining employees with monetary compensation is to offer cash incentives such as bonuses, rewards, and profit-sharing programs. These are good ways to immediately compensate and reward employees for their contributions to your company's success.

When employees know they'll be rewarded, they'll be more inclined to stay. You can use two approaches when offering cash incentives.
Project-completion rewards - You can offer employees project-completion rewards. Offer employees on key projects a $5,000 to $10,000 bonus for staying and completing a project. Most employees will stay for their bonuses.
Cash rewards for exceeding goals - When the company is successful, you can reward employees with cash. When your company meets or exceeds projected financial goals, ensure that all employees share in the profits. This shows employees that your company recognizes how its employees' contributions affect the bottom line. Although most employees don't like to admit it, money is a huge motivator for how and where people work. A strong monetary compensation system, which could include stock options or cash rewards, should be a part of your retention plan.

Assessing Your Competitors' Recruiting Efforts

As a recruiter, you probably want to attract and hire the best people available to fill positions in your company. But in your quest for the best, you're in direct competition with other companies. Therefore, you should take the time to learn about your competitors' recruiting efforts.
Having a thorough understanding of the "enemy" takes time and effort, but it has its rewards. You will know where you stand in comparison to your competitors, you'll know your strengths and weaknesses as well as their strengths and weaknesses, you'll know what recruitment techniques work for your competitors, and you'll know what you're up against in order to develop an effective recruitment plan. You can use the following strategies to learn about your competitors' recruiting efforts.

1. Find out what compensation they can offer.
First, you should find out what compensation your competitors offer. By learning this information, you can determine how you measure up in comparison. Questions you should ask are:
What salaries do they offer?
What type of benefits package do they offer?
What kind of training and career development do they offer? By asking questions about compensation, you can determine what you can offer that your competitors can't or won't offer. It can also help you determine which areas of your compensation package need to be improved.

2. Find out about their recruitment approach.
Your competitors' recruitment approach is the second thing you should learn about. Do they recruit college students from big schools? Do they go after your employees or those of other competitors? What newspapers and job boards do they advertise in? How do they use their Web sites to recruit?
Learn what's working for them, and decide whether those methods can work for you. If you can't recruit the way they do, rethink your approach. Go to smaller colleges, advertise in different papers, and spiff up your Web site.

3. Find out about the differences between you and them.
The third strategy involves learning about your competition to find out what makes your companies different. What are the differentiating factors that would make a candidate choose to work for you over your competition?
For most workers, the work environment is most important, followed by fair compensation and recognition. Other issues, such as telecommuting, the dress code, the corporate culture, management styles, recognition programs, and how fast a new recruit can be brought on board are differentiating factors.
So how can you find out about your competitors' compensation packages and recruitment approaches, and the differences between your companies? You can learn this information by talking to your counterparts at other companies when you attend conferences and seminars. Ask these people what they offer and what they do to attract workers. And keep track of whom your employees are leaving you for by using exit interviews.
Remember, you're in competition with many other companies for the best job recruits. By taking the time to learn about your competitors' recruiting efforts, you'll be better able to focus on your own advantages, address your disadvantages, and ultimately create a program that helps you attract the best candidates.

Identifying Organizational Culture

What makes working for one company so very different from working for another company, even if the products and services are alike?
Culture is what makes the difference. It is the characteristic that influences how a company handles its day-to-day operations, and it determines how an organization communicates with its employees.
Culture affects the policies and procedures that are implemented. And culture is what gives an organization a different feel from other businesses in the same industry.

Types of culture

Every organization has a culture of sorts. In fact, every organization actually has two cultures.
The visible culture is the one that is expressed in the company's charts, policies, and procedure manuals. This is the organization that is apparent to outsiders.
The shadow organization is the informal day-to-day behavior carried on as a result of tradition and habit. It's what people do, rather than what they say.

The shadow organization is often more powerful than the visible organization. It has its own leaders and unwritten rules of operation. This shadow is influenced by the values and habits of accepted actions and activities.
Think of it as a complex mesh of social forces that influence the behavior of each member of the organization. This makes up the norms of the organization.
Norms of operation are often formed by historical events within the organization. It may be representative of past victories, setbacks, rivalries and feuds. Additionally, this informal organization has these characteristics:

• It has its own communication channels
• It has unofficial networks and cliques
• It may determine how an employee feels

The shadow organization is what typically determines the average employee's experience at work. Interestingly enough, the higher individuals are in the organization, the less in-touch they will be with the understanding of what an average workday is like for an average employee.
Management may be sadly unaware of what the organizational culture really is, even though they are the ones most likely to talk about it.

Understanding the shadow culture
Successful leadership requires that you get in touch with the real culture of your organization. This is an integral part of giving meaning to work.
You can gain awareness of your shadow organization by exploring four areas with your employees. The following provides more information about these areas:

• Discuss how employees feel about themselves
• Determine how employees feel about their jobs
• Identify how employees feel about their teammates
• Explore how employees view the organization

When employees like themselves, their jobs, their teams, and their organization, they are more likely to be happy, energetic, involved, and committed employees. They are also more likely to create that same environment for the other people they work with.
Giving purpose, meaning, and direction to work is a fundamental leadership role. The art of molding an organizational culture that enhances meaning requires a leader who is willing to participate with employees rather than simply direct them.
It takes time and energy. However, the payoff is in having the information that allows you to shape a compelling vision around which employees can rally.

On Boarding Process – Some Industry Best Practices

Computer Sciences Corporation (CSC): Every new joinee at CSC is welcomed with a flower bouquet and an announcement at the reception board. New joiners are assigned a buddy that helps them settle in and get acquainted with the company. The buddy role is open to all employees who have been with CSC for six months or more. He helps a new joiner through the initial few weeks.

MindTree Consulting: MindTree way of welcoming lateral joinees: The laterals who join MindTree are inducted into the MindTree culture through an initiative known as “Arboretum”. It’s the snazziest of workspace at Mindtree where the lateral recruits are helped to settle down, understand their new role, assimilate Mindtree’s culture and its way of handling people. The program could be from 3-28 days. Arboretum is a Latin word to mean a botanical garden where uprooted trees are nurtured before they are moved to the exhibition.

Intel: Throughout the first six months, new employees attend additional courses to help them understand and assimilate Intel’s culture, such as “Working Through Company’s Values”, “Problem Solving”, “Constructive Confrontation”, and "Effective Meetings".

Qualcomm: “Breaking Ice Over Breakfast”. At Qualcomm, a fresh idea like Touchpoint Breakfast has been introduced for new hires so that they can reconnect over breakfast after one week of joining.

Google: “Nooglers on a date”. The tagline is that the first days are special – it should be like a date experience. From small gifts, lunches with a buddy to make them feel special – wanted and celebrated. So from pranks to lunches, to getting introduced to Googlers at the Friday afternoon gathering. Google rolls out the red carpet to welcome new recruits.

"If you give people freedom, they will amaze you"

Interview with Laszlo Bock, VP, People Operations, Google
Q: Google is seen as a fun and lively place to work for. How do you build and retain that culture?
A: Fun, freedom, interactivity and the ability to explore is vital to this company. We look for very smart people who are creative and adaptable. The second is a formal mechanism to keep our culture going; we have small transforming communities of people that work on a wide range of ideas. The third is through a demonstration of culture and self-monitoring of that culture. For example, we have numerous email lists in the company, and if a person does something that is wildly outside the culture, another person will gently point it out to him.
Q: So there is no hierarchy? Can mistakes be pointed out by someone junior?
A: There is a primacy of ideas and debate here. If you have a compelling idea it doesn’t matter who you are. Our organization structure is simple. Until about 2-3 years ago the most senior title at Google, other than the founders was VP. Two years ago when we added a Senior VP title, that was a big deal for us. While there are some gradations, generally we think of ourselves as individual contributors, managers, directors and VPs.
Q: Do you put the new recruits through a new learning process and do people just learn by doing?
A: It’s a little bit of both. New Googlers are called “Nooglers”. When you join Google, the workstation is decorated with balloons. We say you are a “noogler” till your balloons drop to the ground. We work in small teams of 2-5 people, that helps people to learn by doing. We fundamentally believe that people are good, people are smart and if you just give them freedom they will surprise and amaze you.
Q: How do you account for the 20 percent free time to innovate that Google gives to its people?
A: It’s individually managed; some people spend a little time everyday, some take it all in one go.
Q: Are you the best paymasters in your industry?
A: We think about the total rewards. At Google every employee gets a bonus, then there’s the café, the massage parlor and all our other benefits. We believe in pay for performance and if you are a strong performer you have an opportunity to earn more. Apart from that how much you learn, the environment, the people you work with is equally important. We try to be very competitive in every one of those areas.

How Mentoring supports professional development

The 21st century business environment demands employees who are lifelong learners and companies with cutting-edge training strategies. How can mentoring help?

Do you sometimes feel as if your training department is becoming a mini-university? Developing job-specific skills, keeping your employees on the cutting edge, and preparing employees for advancement all require considerable resources and commitment. But your payoff is having more qualified employees and a more productive workplace.

Mentoring can help you meet your organization's professional development needs by identifying current training needs and methods, evaluating the effectiveness of current training, and developing compatible mentoring approaches.

First, you have to identify your current professional development needs and the methods being used to meet those needs.

Training Methods - Your training methods may include outside classes, on-site trainers, books and manuals, Web-based training, and training from supervisors, co-workers, or inside experts.
Training Needs - Your employees may need to acquire skills and knowledge related to technology, computers, writing, presentation, accounting, leadership, sales, and so on.

Next, you need to evaluate the effectiveness of your company's current professional development.
Are all professional development needs being met?
If your company has a high turnover rate, you may need an induction program. Or if you lack qualified candidates to promote from within, you may need to focus professional development efforts on leadership preparation or providing support to new leaders.

Are training methods appropriate for the material being taught?
A classroom is an effective setting for training a group of people on the same skills. But most classrooms—except for computer labs—don't allow learners to apply what they're learning. You may need to replace or supplement classroom training with other hands-on methods.
Finally, you must develop mentoring approaches that are complementary to and compatible with your company's current professional development. Mentoring programs should support other training methods, not conflict with them. Depending on the specific need, mentoring may replace or supplement other training methods, but shouldn't duplicate them.

When new employees need to learn specific job skills, mentors provide the most effective instruction by working alongside their proteges on actual project work.
If you provide Web-based training and leading books to help prepare promising employees for management positions, you will find supplementing those training methods with a mentoring program for new managers will improve the effectiveness of your training program.

Having a mentor is like having your own personal instructor and guide. You can use mentoring to meet professional development needs and improve the outcome of your current training programs. Mentoring supplements traditional training. When you identify current training needs and methods, evaluate the effectiveness of current training and develop compatible mentoring approaches.

Maslow's hierarchy of needs

Each of us is motivated by needs. Our most basic needs are inborn, having evolved over tens of thousands of years. Abraham Maslow's Hierarchy of Needs helps to explain how these needs motivate us all.
Maslow's Hierarchy of Needs states that we must satisfy each need in turn, starting with the first, which deals with the most obvious needs for survival itself.
Only when the lower order needs of physical and emotional well-being are satisfied are we concerned with the higher order needs of influence and personal development.
Conversely, if the things that satisfy our lower order needs are swept away, we are no longer concerned about the maintenance of our higher order needs.
Maslow's original Hierarchy of Needs model was developed between 1943-1954, and first widely published in Motivation and Personality in 1954. At this time the Hierarchy of Needs model comprised five needs. This original version remains for most people the definitive Hierarchy of Needs.
1. Physiological needs
These are the basic human needs for such things as food, warmth, sex, water, and other body needs. If a person is hungry or thirsty or his body is chemically unbalanced, all of his energies turn toward remedying these deficiencies, and other needs remain inactive.
2. Safety needs
With his physical needs relatively satisfied, the individual's safety needs take over and dominate his behavior. These needs have to do with man's yearning for a predictable, orderly world in which injustice and inconsistency are under control, the familiar frequent, and the unfamiliar rare. In the world of work, these safety needs manifest themselves in such things as a preference for job security, grievance procedures for protecting the individual from unilateral authority, savings accounts, insurance policies, and the like.
3. Social needs
After physiological and safety needs are fulfilled, the third layer of human needs is social. This psychological aspect of Maslow's hierarchy involves emotionally-based relationships in general, such as:friendship intimacy having a supportive and communicative family Humans need to feel a sense of belonging and acceptance, whether it comes from a large social group (such as clubs, office culture, religious groups, professional organizations, sports teams, gangs) or small social connections (family members, intimate partners, mentors, close colleagues, confidants). They need to love and be loved by others. In the absence of these elements, many people become susceptible to loneliness, social anxiety, and depression. This need for belonging can often overcome the physiological and security needs, depending on the strength of the peer pressure.
4. Esteem needs
All humans have a need to be respected, to have self-esteem, self-respect, and to respect others. People need to engage themselves to gain recognition and have an activity or activities that give the person a sense of contribution, to feel accepted and self-valued, be it in a profession or hobby. Imbalances at this level can result in low self-esteem, inferiority complexes. People with low self-esteem need respect from others. They may seek fame or glory, which again depends on others. However confidence, competence and achievement only need one person and everyone else is inconsequential to one's own success. It may be noted, however, that many people with low self-esteem will not be able to improve their view of themselves simply by receiving fame, respect, and glory externally, but must first accept themselves internally. Psychological imbalances such as depression can also prevent one from obtaining self-esteem on both levels.
5. Self actualization
It is the instinctual need of humans to make the most of their abilities and to strive to be the best they can. Working toward fulfilling our potential, toward becoming all that we are capable of becoming.
In Maslow's scheme, the final stage of psychological development comes when the individual feels assured that his physiological, security, affiliation and affection, self-respect, and recognition needs have been satisfied. As these become dormant, he becomes filled with a desire to realize all of his potential for being an effective, creative, mature human being. "What a man can be, he must be", is the way Maslow expresses it.
Maslow's need hierarchy is set forth as a general proposition and does not imply that everyone's needs follow the same rigid pattern. For some people, self-esteem seems to be a stronger motivation than love.

Douglas McGregor's Theory X and Theory Y

Douglas McGregor in his book, "The Human Side of Enterprise" published in 1960 has examined theories on behavior of individuals at work, and he has formulated two models which he calls Theory X and Theory Y.

Theory X:

• Theory X people are naturally lazy and will do as little as possible. They must be forced with the threat of punishment to deliver results for their organization, and they often prefer to be directed.
• Theory X people want to avoid responsibility; they are relatively unambitious and want security more than anything. As managers, they tend to be results- and deadline-driven and have an authoritarian style of management.

Theory Y

• Theory Y people apply self-control and self-direction in the pursuit of organizational objectives. They are committed to objectives as a function of rewards associated with their achievement, and they often seek and accept more responsibility.
• Theory Y people have the capacity to use a high degree of imagination, ingenuity, and creativity in solving organizational problems. Often their intellectual potential is only partly utilized. They use a participative style of management.

Frederick Herzberg's hygiene-motivation theory

Hygiene factors
Hertzbergs' first component in his approach to motivation theory involves what are known as the hygiene factors and includes the work and organizational environment. These hygiene factors include:

• company policy and administration
• Supervision (leadership and management, including perceptions) which people receive while on the job
• working relationships, including those with co-workers and your relationship with your manager
• status
• salary
• working conditions security (including ergonomics)

These factors do not lead to higher levels of motivation but without them there is dissatisfaction.

Motivation factors
The second component in Herzbergs' motivation theory involves what people actually do on the job and should be engineered into the jobs employees do in order to develop intrinsic motivation with the workforce. The motivators are:

• achievement
• recognition
• the work
• responsibility opportunities for advancement and growth

These factors result form internal instincts in employees, yielding motivation rather than movement.

Both these approaches (hygiene and motivation) must be done simultaneously. Treat people as best you can so they have a minimum of dissatisfaction. Use people so they get achievement, recognition for achievement, interest and responsibility and they can grow and advance in their work.

Ethical Perspectives

Four perspectives from which decision makers examine ethical issues:

1. Relationships - From a relationships perspective, actions that nurture and support a web of relationships are right. Actions that harm or destroy relationships are wrong. When decision makers examine ethical issues from the perspective of relationships, they may overrule considerations of fairness.
2. Fairness - A fairness perspective assumes that people are naturally competitive and willing to fight to gain an advantage over one another. By agreeing to cooperate, societies avoid conflict and work toward shared interests. Competitive people cooperate with one another as long as everyone is treated equally. In a fairness perspective of right and wrong, actions that treat people equally are right. Actions that show preference or bias are wrong. A fairness perspective is generally useful only after the rights of all parties to a decision have been recognized.
3. Rights - A rights perspective applies an absolute standard to measure ethicality. Right actions are always right, regardless of whether they provide utility for the society. Absolute "rights" define what members of a society must always be permitted to do or always be prohibited from doing. Rights can be positive and grant access to certain privileges, such as the right to freedom of speech. They may also be negative and prohibit society from denying privileges, such as the right to be free from invasions of privacy. Decision makers generally examine decisions from a perspective of rights only after the utility of an action or decision has been established.
4. Utility - Actions that bring benefits or happiness to many people provide utility. Decisions or actions that provide benefits to many people are generally considered more ethical than those that benefit only a few people. The utility of an action or a decision is the most fundamental measure of its ethicality.

Four Basic Economic Responsibilities of a Business

A business has economic responsibilities to its direct stakeholders—its investors, employees, and customers. A business has an ethical obligation to meet these responsibilities.
There are four basic economic responsibilities a business has to its direct stakeholders:

1. Profitability: A business creates profit when it sells products or services that are more valuable than the materials and labor it uses to create them. Put simply, the business creates profit by adding value.
   Adding value and creating profit serve the interests of all of a company's direct stakeholders. The company produces products or services that are valuable to customers. The company uses profits to reward investors and pay employees.
2. Transparency: When a business acts with transparency, it provides as much information as practical about its operations. The company allows direct stakeholders to clearly see its practices, strategies, and financial positions. Transparency benefits direct stakeholders.
   Transparency serves the interests of investors by giving them information they need to evaluate the potential risks and rewards of investing in the company. Transparency lets employees and customers see how a company is run. They can make informed decisions about where they work and where they spend their money.
3. Nondiscrimination: In an economic sense, nondiscrimination doesn't refer to the absence of bias against gender or ethnic groups. It means a business applies the same financial criteria to all of its customers, suppliers, and employees. Direct stakeholders benefit from nondiscrimination because the company makes decisions on the financial merit, rather than on the biases and preferences of decision makers.
4. Sustainability: Businesses ensure the sustainability of their operations by improving business processes and developing secure, long-lasting relationships with suppliers and customers. An organization's investors, employees, and customers are called direct stakeholders because they have a stake in the company's future.

Direct stakeholders benefit from the sustainability of a business because when a business has a secure future, investors continue to earn dividends, workers continue to draw paychecks, and customers continue to buy the company's products and services. Why do business organizations exist? Their primary purpose is economic—to make profits for owners and direct shareholders and to provide jobs for employees. Their first ethical responsibility is to fulfill these economic goals.

Four Common Ethical Problems

The phrase business ethics draws a predictable reaction from cynics. They insist that it's a contradiction in terms. However, that's simply not true. Senior managers in a vast majority of businesses believe it's important for employees to act and think ethically. These businesses set standards of conduct to help employees recognize ethical problems and respond appropriately.
Companies that set ethical standards often formalize the standards in a code of ethics. A company's code of ethics addresses the ethical dilemmas its employees face most often. Codes created by different companies may describe vastly different ethical dilemmas.
However, a wide variety of dilemmas spring from the following four common ethical problems:

1. Absence of transparency—Everyone affected by a decision should have all relevant information about the decision maker's possible gain, obligations, and relationships. When relevant facts are hidden from one or more parties, the decision is made in an absence of transparency.
2. Unwarranted gain—Important business decisions are usually intended to cause a gain for the decision maker's company and possibly for other companies. When decision makers seek an improper or unearned benefit for themselves or others, that's an unwarranted gain.
3. Lack of impartiality—In an ideal world, decision makers use rational criteria to make decisions; they don't favor one party over others for personal reasons. However, decision makers may let family relationships, friendships, or other biases influence them. When they do, the decision makers lack impartiality.
4. Nonperformance of obligation—Employees have an obligation to perform the required duties of their jobs. They also have an obligation to act according to the company's principles of conduct. When employees fail to meet their obligations or when they cause others to fail, that's nonperformance of obligation.

Employees in organizations—like other groups of people—behave according to the values shared by members of the business. Common ethical problems create unethical behaviors that threaten those shared values.

Developing a Healthy Culture

For an organizational culture to grow and thrive within your corporate environment, you need to set the example. Maintaining the organizational culture that you desire takes work. It requires teaching, living, and doing at all levels of the organization at all times.
In addition to teaching, you should also be doing. Get involved at all levels and champion cultural change. This will help you pave the way for change to happen. Designing a way for people to monitor their own behavior is important.
If you want people to be accountable, then they need to know how they're doing. Encourage customers to provide online feedback via a message center. This also lets customers know that your company cares about its business.
Teaching and doing are two important steps in helping your culture thrive. The third step is living the culture—making it a natural part of your interactions. As everyone lives the culture, the change will become widespread. It can energize longtime employees and transform people who are new to the company.
The following are strategies for living the culture:

• Rearrange your offices so that people at all levels work side by side. It's easier for the managers to know what's going on, and will also help them to develop rapport with the staff.
• It's not enough just to tell employees the new culture is good for them—you need to show them.
• Make people responsible for budgets, and also give them freedom to make decisions just as they do at home.
• If you're going to live the culture, you need to deal with problems proactively. Get together once a week and talk about where you are and where you want to be. Identify potential problems and work on strategies for managing them proactively.

It's time to start teaching, doing, and living the values you want to define your organizational culture.

Cultural Traits of Performance Organizations

Have you ever noticed that some organizations seem blessed with perpetual good luck, while other organizations seem doomed to be in the wrong place at the wrong time?
For the companies that move from success to success, there's probably more involved than just good fortune—it may be their cultures. There are a number of cultural traits that can have a significant effect on organizational performance. These traits are:
# involvement
# consistency
# adaptability
# communication

Involvement:
Does your organization strive to build human capabilities? Do the employees feel a sense of ownership and shared responsibility? If you can answer yes to both of these questions, then your organizational culture exhibits involvement, one of the traits affecting performance.

Use the following methods to encourage and maintain involvement:

• Empower employees with the authority, initiative, and ability to manage their own work. This creates a sense of ownership and responsibility toward the company.
• Place value on working cooperatively toward common goals to which all employees feel mutually accountable.
• Develop capabilities to meet future needs. Invest in the development of your employees' skills.

Consistency:

Organizations that exhibit consistency are able to reach agreement on critical issues. They have the ability to reconcile differences when they occur. Coordination and integration allow different functions and units of the organization to work together well to achieve common goals. Boundaries don't interfere with progress.
Consistency can be achieved by adopting a set of shared values that creates a strong sense of identity and establishes clear expectations.

Adaptability:
Another important cultural trait is adaptability. Adaptable organizations are able to read the business environment, quickly react to current changes, and anticipate future changes. These organizations understand, react to, and anticipate customers' needs.

Communication:
Is it important to share a meaningful long-term direction for your company with employees at every level? Communication is the fourth cultural trait of effective organizations.
Effective communication embodies core values and captures the hearts and minds of the organization, while providing guidance and direction. Clear communications convey the organization's purpose and make it obvious how everyone can contribute. When communication flows in all directions—from the top down, and from the front line upward, every employee feels free to share information, both good and bad.

Cultures vary from one organization to another, and even from one department to another within the same organization. They may differ by individual autonomy, organizational structure, rewards, and interpersonal relationships.

How much influence does a leader have on Organizational culture?

Each employee of an organization is an influencer as far as the organizational culture is concerned but my opinion is that the senior the person, the greater the influence. I would like to illustrate this with a real life case scenario of an organization. Let’s call this organization “ABC Inc”. ABC is headquartered in Bangalore and is in the software services sector. It has a fantastic culture and employee engagement levels are quite high. Employees are encouraged to take time off from their work to have fun, and make office a lively place. It also has a flat hierarchy and every employee is treated as an equal irrespective of their level in the organization.
To strengthen its presence in South India, ABC decided to open a development center in Chennai. It appointed Mr. G as the location head. Mr. G has around 30 years of experience and is quite well known in the industry. He has spent most of his years in organizations which are hierarchical in nature and where there is a clear distinction between people in different grades. He is a person who likes to exercise his powers, use his privileges and enjoys being address as “Sir” by employees.
For the Chennai center staffing, many of the staff from the Bangalore office was transferred to Chennai. Freshers were recruited from different colleges in Tamil Nadu, and then were trained at the Bangalore office and then moved to the Chennai office. Mr.G also brings in a bunch of his old colleagues and these folks assume senior manager positions at the Chennai office.
After 3 months of operation, the Bangalore headquarters start getting complaints from Chennai employees that the culture there sucks. The Headquarters decides to do a secret audit and sends one HR person over to Chennai. The HR person meets with a cross section of the employees and seeks their feedback. He finds that the Chennai office has become very hierarchical and if an employee wants to meet a senior manager, he or she will have to send a request for meeting. It definitely is not following an open door policy. He also sees that the office is quite with minimal interaction between employees.
Even though there is no policy written down that specifies how the working environment should be, the leader’s likes and dislikes get into the system and that influenced the culture. A person who has the power to take decisions, and is high up in the organizational pyramid definitely is an influencer to organizational culture.

Is hiring women all that much more profitable than men ?

Company experts feel that it is so. In fact, with many successful businesses, the female-male employee ratio is as now as much 30-70, with numbers only increasing. Behavioural researches concluded that the fair sex was better in socializing and interacting effectively with people. Women were found to have more commitment in their careers, and were focused on developing and maintaining a long-term career. With this find coupled together with the 2008 expectation of attrition rates increasing dramatically, it is no wonder that companies are now hiring more female employees.One company commented that women were more 'transparent' and trustworthy and as a result established confidence in clients. Is hiring women all that much more profitable than men? Growth-oriented company experts say it is a fact that just cannot be ignored.IT companies have begun to cash in on the largely untapped female-employee benefits. They are now hiring and training many new female employees. Experts add that although there are many benefits to hiring women, no 'one size fits all'.As for corporate trends and changes, gone are the days when being a woman attempting a career was yet another hurdle to cross.

Emotional Intelligence and Life Success

Which do you think is a more accurate predictor of life success: A person's emotional intelligence or a person's IQ? If you're like most of us, you'd probably guess that IQ—a person's mental intelligence—is more important. However, you'd be surprised to learn that a person's emotional intelligence is actually more closely tied to life success. Why? While IQ determines a person's memory, reasoning ability, and fluency with language and math, emotional intelligence is linked with a person's moods, attitudes, empathy, and motivation. And these are powerful forces that can result in an individual's success in business or social settings.

The elements of IQ - IQ measures a person's intellectual ability and generally remains steady throughout a person's life. Interestingly, it contributes to only about 20 percent of the factors that determine a person's life success. Traits exhibited by a person with a high IQ include a wide intellectual capacity and range of interests, confidence and fluency in expressing thoughts and opinions, a tendency to be anxious and to worry, and a critical nature. IQ is linked with the following mental abilities:
> Verbal comprehension, which is the ability to understand and define words
> Word fluency, which is the ability to think of words rapidly
> Number facility, or the ability to do mathematical problems
> Spatial ability, the ability to visualize objects and draw them from memory
> Memory, which is the ability to memorize and recall information
> Perception, the ability to notice details and detect similarities and differences
> Reasoning, the ability to follow general rules.

The elements of emotional intelligence
Emotional intelligence is comprised of a broad range of abilities, including awareness of one's own emotions, the ability to regulate moods, the recognition of emotions in others, the ability to motivate oneself in the face of frustration, the ability to control impulses and delay gratification, and the ability to empathize. Emotional intelligence contributes to about 80 percent of the factors that predict life success. Individuals with high emotional intelligence are poised, outgoing, and cheerful. They have empathy for others, express their feelings directly but appropriately, and have a capacity for developing relationships. Therefore, emotional intelligence is a more accurate predictor of life success than IQ is. Fortunately, emotional intelligence is a skill that can be developed more readily than pure intellectual abilities. To be more successful in your job and in your personal life, strive to be aware of your emotional intelligence and to improve the emotional aspects of your life.

Working with Managers to Improve Retention

Companies don't cause employees to leave—people in companies cause employees to leave. Employees often leave companies because of conflicts with people, usually people in authority.
Employees are more likely to stay with a company when they enjoy their co-workers, feel respected, and know they're valued by their managers—in other words, when they feel connected to the people in their company.

Managers can improve retention by applying strategies for developing strong connections with employees. As a human resources professional, you can work with your managers to help improve employee retention. Specifically, you can help managers build and maintain employee connections in the following ways.

1. Encourage managers to ask employees for honest feedback.
The first way managers can build and maintain employee connections is to ask employees for honest feedback about work situations. Managers need to find out if their employees are happy with the company and with their jobs. They should take the time to ask pointed questions and listen to the answers. This may require some prodding on the part of the manager. Employees aren't likely to be forthcoming with criticism or negative feedback at first. Managers should be patient but persistent. Eventually, employees will feel comfortable confiding in their manager if their manager works to build relationships with them.

2. Encourage managers to be straightforward and honest with employees.
Another strategy managers can use to build and maintain employee connections is to be straightforward and honest with employees when communicating company information. Managers should keep staff members informed about what's going on in the company and should tell employees good and bad news in a sincere and straightforward way. Otherwise, employees may hear rumors and jump to their own conclusions.

Have you ever had a manager who didn't keep you informed about company business decisions? Did you find out about decisions that affected you from your co-workers, or worse, from an outside source? How did that make you feel about your manager? Managers can build trust with employees by keeping them informed. Employees are loyal to their managers when they feel connected to their managers. Managers earn respect when they communicate information in an open and honest way.

3. Encourage managers to align work assignments with employee interests and skills.
The third strategy managers can use to build and maintain employee connections is to align work assignments with employee interests and skills. When managers get to know their employees' interests, strengths, and weaknesses, they are better able to assign work in such a way that employees will be engaged and successful. In addition, they should try to give employees options that coincide with the company's demands and the employees' interests.

Managers can help retain valuable employees by developing strong connections with their employees. Are managers in your company trained well to do that? If not, work with them to help them apply the strategies for developing strong connections with employees, which in turn can help your company's retention efforts.

The Two Causes of Attrition

Did you know that experts estimate the cost of turnover to be three times an employee's salary? This simple statistic alone explains why it's so important to develop strategies to retain good employees. And the first strategy is to find out why people leave your company and to keep track of the reasons people leave.

Attrition is an expected yet dreaded cost of business. However, if you understand why employees leave, you can accept unavoidable turnover and prevent avoidable turnover. Essentially, there are two causes of attrition, which can be grouped into two broad categories—functional attrition and preventable attrition.

1. Functional attrition

Functional attrition is unavoidable, inevitable turnover. Examples include employees who retire, employees who leave for a spouse's job transfer, and employees who leave because of health problems or to care for sick relatives. In other words, functional attrition is caused by circumstances that can't be controlled. You must expect and accept this type of turnover.

2. Preventable attrition

Preventable turnover, on the other hand, can usually be controlled and avoided but often isn't. Poor hiring practices, misguided policies, and inflexible corporate attitudes are some of the preventable reasons people leave companies. Some examples of preventable attrition are listed below.

a) Lack of job satisfaction - Anna is resigning. She wants to advance her career, but her position is a dead end. She's a great employee and likes her company, but her goals don't match with her position's potential. You could have avoided her resignation by moving her into a position with growth potential.

b) Stressful work environment - Stan works long hours with few rewards. He's expected to work 60 hours a week to meet his deadlines. Stan feels undervalued and overworked. He's looking for another job. You could prevent this by setting deadlines that are achievable in a 40-hour workweek.

c) Outside influences - Dawn was approached by a recruiter who said he could find her a job paying twice what your company is paying her and with far better benefits. She'll take him up on his offer. You could prevent this by paying employees what they're worth and having a comprehensive benefit plan.

d) Conflict with a manager - Bruce and his manager just don't get along. Bruce is a valued employee and so is his manager. Bruce wants to resign. You could prevent this by assigning Bruce to another department or working with the manager and Bruce on conflict resolution.

Preventable turnover occurs when your company can change a policy or find a solution to keep employees from leaving but doesn't. People leave companies for a variety of reasons. Below are some examples of employees who have chosen to leave their companies.

Functional - Shirley retired after 15 years as her company's receptionist. This is an example of unavoidable, or functional, turnover. Eventually, employees will retire, and you can't do much about it.

Preventable - Andrew resigned because he considered his work environment to be unsupportive. This is an example of avoidable, or preventable, turnover. If Andrew is a valuable employee who is leaving because he doesn't feel supported, then his company needs to look at ways to fix this problem.

Functional - Ronald left his company to move to the city his wife was transferred to. This is an example of unavoidable turnover. Unless Ronald can transfer to another office in the new city or telecommute, his company can't do much to retain him.

Preventable - Donna left her company because she isn't satisfied with her advancement opportunities. This is an example of avoidable turnover. If Donna, a valuable employee, is leaving because she has no career opportunities, her company should review its career development and advancement strategies. Remember, the first step to managing turnover is to understand why valuable employees leave your company. Once you understand the causes of attrition, you can accept cases of functional attrition and recognize the need to look within your organization for ways to avoid preventable attrition.

Cycle of Motivation

Factors that Contribute to Emotional Competence

Researchers have determined that there are four factors that contribute to emotional competence. These four factors are impulse control, mood manipulation, hope, and optimism. Individuals who demonstrate an ability to control their impulses and moods and who possess hope and optimism as part of their overall emotional makeup, generally are more emotionally stable, and are better able to achieve success in both their professional and their social lives. Details about these four factors are described below.

1. Impulse control
Impulse control is often considered the core of emotional self-management. Our ability to control our impulses and delay gratification says a lot about the way we respond to various situations. Researchers have determined that individuals who can control their impulses are more self-assertive and are more competent in handling frustration, stress, and pressure. In addition, these individuals are better able to face challenges and are more likely to be relentless in their pursuit of valued goals. Research also indicates that these individuals are more trustworthy, dependable, and self-reliant.

2. Mood manipulation
The second characteristic that contributes to emotional competence is mood manipulation. Even small mood changes can affect a person's ability to think clearly. Good moods actually enhance an individual's ability to think and problem-solve. Laughing frees up creativity and promotes a person's ability to see complex relationships and consequences. Joking can actually help a person think through a problem. Studies show that problems are more likely to be solved by someone who has just had a good laugh and is in a good mood. Alternatively, if you're in a bad mood and try to make decisions, you may be overly cautious and make decisions based on anger or fear.

3. Hope
Recent research shows that hope is a crucial element in a vast array of activities. In everything from taking tests to handling a difficult boss, hope is more than just a vague belief. Researchers have discovered that hope gives people confidence in themselves, so that they are better able to achieve their goals. In terms of emotional competence, hope plays a role in preventing a person from giving into defeat, depression, setbacks, or anxiety. People with hope have less emotional stress.

4. Optimism
Optimism is an extension of hope in that it protects people from apathy and depression. Optimistic people see failure as an event they can overcome, and optimism prevents people from blaming their failures on personal traits they cannot change. If you're a salesperson, optimism is an especially important trait, since a study has shown that salespeople who are naturally optimistic sold 37 percent more than individuals who where pessimistic.

Clearly, there is a link between success and a person's ability to control impulses, manipulate moods, and exhibit hope and optimism. A person who exhibits these traits usually is an emotionally competent person. You may want to assess your own competencies in these four areas. At the very least, you may learn a lot about yourself and your ability to handle difficult situations. At best, you may be able to improve your own emotional competence and your chances for success in both your professional and your social life.