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Unlimited PTO – Is It Right For Your Company?

Tuesday, March 14th, 2017

Business executives and HR professionals alike continue to explore ways to improve their organizations’ culture to drive both employee engagement and business results. One such way is by providing employees increased flexibility to improve the balance between their work life and personal life. The following information will provide key insights to help guide you in contemplating the very popular benefit of Unlimited PTO.  As your organization’s HR Business Partner you will want to be driving this conversation, not simply reacting to it.

What You Should Know about Unlimited PTO Plans

  • Unlimited PTO is a very popular topic these days.  But despite all its popularity only approximately 1% of U.S. companies* have an unlimited PTO plan in place.  This is clearly not a trend!
  • This 1% includes the likes of Netflix, GE, and LinkedIn. These are all well managed and results based businesses that compete aggressively for very targeted highly qualified and talented employees. These organizations also offer top tier compensation and benefits to their employees.  In consideration for these rewards, employees typically work very long days each week to achieve the desired results.
  • Culture First: Unlimited PTO works best in organizations’ cultures that values accountability, trust, and teamwork. An unlimited PTO plan, in and of itself, is not the catalyst that will seamlessly transition your organization to this state.  You must first build a culture of trust and accountability that will support the high degree of employee flexibility that an unlimited PTO plan requires – this is critical!  (Talent Management, July/August 2016)
  • Employees that are provided an unlimited PTO benefit typically do not take any more time off than in their prior traditional plan; in some cases, they are actually taking less time.
  • A 2013 time-off study conducted by Oxford Economics revealed that U.S. workers use on average 77% of their annual PTO accounts (or 16.2 of the 21 days allotted annually – leaving nearly 5 days on the table).
  • Although employers are not seeing a noticeable uptick in days off under the unlimited PTO approach, they are noticing that employees are altering how they are taking time off. For example, more employees are taking extended 4-day weekends. This is in part because families tend to be more spread out today and travel is required to attend family events. (Fortune,  March 2016)
  • Employees have a high degree of empowerment under unlimited PTO. However, these same employees also tend to be very diligent about their PTO decisions.  They want to perform high-quality work and they are also keenly aware their organization’s cultural norms (trust, accountability, teamwork etc.) and peer behaviors. These employees tend to make responsible choices that balance out business priorities and personal needs.  In many organizations however a collaborative discussion between employee and boss is required prior to the time off.

Tips for implementing an Effective Unlimited PTO Plan

  • Link your plan to your company’s culture and values. Your values will need to include: accountability, trust, and teamwork. As mentioned above, if your current culture is void these values, you will need to lead your business through a change initiative to lay this critical foundation.
  • Provide guidelines around how time-off requests get approved. Simple guidelines can help employees know when it is appropriate or not to request time off.  This is particularly helpful in the beginning stages of your roll-out.
  • Ensure your employees know that time off is a two-way street: employees receive increased time off flexibility and in return they perform at high a level ensuring their deliverables are completed on time. Further, they ensure that their teammates don’t feel abandoned during the employee’s time away from work.
  • Consider a pilot plan and be clear with your employees of your intent. Think this through thoroughly as rescinding an employee benefit, even a pilot program, can have adverse employee relations repercussions.
  • Consider naming your program something other than “Unlimited PTO.” “Personalized PTO” may be a viable alternative or other names that convey the overarching purpose of responsible employees making good decisions about their work and time off.
  • Drive Trust: shift your attention from the clock to contributions. Focus on your employees’ results and the success of the business – not how much time your employees are taking off.

Unlimited PTO plans are not for every company, in fact, they are not designed for many businesses in their current state. Transitioning to an unlimited PTO plan requires much thought, planning, and hard work to lay the proper foundation (culture) to effectively support this type of flexible plan. Does your current culture drive results through accountability, trust, and teamwork?

Whether an unlimited PTO plan is right for your business or not, this may be the time to review your total rewards plans as well as your culture. CAI’s Advice & Resolution team can help you think through these issues to discuss the best options for your company. Learn more about the advantages of becoming a CAI member.

Rick Washburn leads the Advice & Resolution team at CAI. In his role, he advises executives and HR professionals on strategic and organizational issues, tackling subjects ranging from employee engagement to talent management. With his 25 years experience in HR management, Rick is uniquely poised to advice and lead businesses to successful HR strategies

 

 

*Source: SHRM

How Effective is Succession Planning in your Organization?

Wednesday, December 28th, 2016

Succession is defined as the right, act, or process, by which one person succeeds to the office or rank of another.

How is the succession of your organizations’ talent happening?  Do some of your employees have implied “rights” to specific positions? Does their “time in grade” entitle those who have “paid their dues” to simply move into a vacated senior position regardless whether or not they are the most qualified or possess the most potential?

Does your organization use the “replacement” method of succession whereby a successor is simply chosen from a ‘short list” of employees that a select group of managers have compiled behind closed doors?

Or does your HR organization provide a collaborative process that brings leaders together to discuss designated positions and relevant potential talent as possible candidates? This of course, is the most effective and desired state.

If your succession process is not of the “desired state” mentioned above, then you are missing out on an incredible opportunity to enable your
business as well as potentially putting your business at risk by not filling opportunities with the top talent within your organization.

How do you get started?  Here are the first 3 steps:

  • As an HR business partner, you first need to be sure you completely understand your business and its current / future strategy and goals.
  • You then need to understand your organization’s key positions that drive and impact your business.  This includes not only key leadership roles but also positions with specialized skills that are challenging to find and or develop.
  • Next, and most importantly, you need to get buy-in from your GM/CEO, key leaders, etc. in the development and implementation of a succession process for your business. Although HR should own this process, succession is not a standalone HR “project” and needs to be done collaboratively and with the support, understanding, and buy-in of senior leaders and other key stakeholders.

Many small and medium-sized businesses fall into the trap of not implementing a succession plan, just like many people put off creating a will. While there are many other key considerations and variables that go into a developing a succession plan, don’t look at the process as insurmountable. CAI can help bring order to the process and partner with you along the way.

Rick Washburn leads the Advice & Resolution team at CAI. In his role, he advises executives and HR professionals on strategic and organizational issues, tackling subjects ranging from employee engagement to talent management. With his 25 years experience in HR management, Rick is uniquely poised to advice and lead businesses to successful HR strategies.

How Do You Treat Former Employees?: Alumni or Deserters

Thursday, December 8th, 2016

employee-departuresHow do you treat your former employees?  Do you treat them as well as your current employees or do you treat them as deserters?  An increasing number of organizations today are treating former employees as valued alumni!

Why?  There are several very sound and  strategic reasons for doing so:

  • Top employee talent: The “war for talent” is real and great hires are hard to come by; competition is fierce!  Your former top employee(s) may find out that “the grass is not always greener on the other side.”   If so, would they likely return to your business or continue to look elsewhere?
  • Social media and references: People talk about and seek out information when considering your business for employment.  With websites such as Glassdoor and LinkedIn it is very easy for your former employees to post their opinions and write reviews about their experience while employed at your business. In addition, many people post information pertaining to their former employer on their personal Facebook and Twitter accounts.  What do your former employees write about your business?  Do you even know?  Does someone in your business monitor these sites and respond accordingly?
  • New business opportunities: Some professional services firms such as Ernst & Young consider their former employees as a specific network or talent pool.  This pool is tapped into as a source of new business opportunities as well as job candidate referrals.  The value of these “alumni” is increasing further as former employees are not only changing jobs but they are increasingly crossing over industry lines, which further expands both individual and company networks.
  • Competitive advantage: More and more employers are recognizing that these networks of former employees are providing a competitive advantage.  Some employers have established specific networks for alumni using websites like LinkedIn while other employers have developed a more customized approach incorporating this feature into their company website.  Some companies write targeted e-mails or newsletters to their alumni while others conduct on-line webinars to help engage and keep former employees up to date.

Consider the strategic benefits of treating your former employees as alumni rather than deserters!  The investment to do so is minimal and the return can be significant!

What steps would you have to take to transition your organization from one being perceived as just a mediocre place to have worked at to one of being viewed as a treasured alma mater? CAI helps 1,100+ North Carolina member companies with workplace planning and transition plans, contact us at 919-878-9222 if we can help your company.

Rick_Washburn circle

Rick Washburn leads the Advice & Resolution team at CAI. In his role, he advises executives and HR professionals on strategic and organizational issues, tackling subjects ranging from employee engagement to talent management. With his 25 years experience in HR management, Rick is uniquely poised to advice and lead businesses to successful HR strategies.

 

Keys to an Effective Performance Incentive Program

Thursday, October 6th, 2016

When it comes to increasing the return on your investment in your company, many business owners think of getting increased value through investments in new computer systems, or more sophisticated warehousing equipment, or a larger facility.  Yet, in today’s business climate, it is the company’s employees more than anything else that represent the single biggest investment that a business owner will make.incentive

That’s why effective performance incentive programs are so important.  Properly designed performance incentive programs not only help to ensure that you achieve your business objectives, but they can actually help employees develop or enhance job skills, thereby improving employee performance and productivity.  And, more productive employees become even more committed to achieving company goals, leading to repeat success and reduced staff turnover.

While the variety and complexity of a performance incentive program will vary from company to company, here are a few ingredients that are critical to the success of all such programs, regardless of your business:

Has High Visibility Among Employees: An effectively-designed performance incentive program will really get the attention of the employees.  But managers must also ensure that they create a continual “buzz” to keep the program objectives foremost in the minds of employees.  Regular progress reports and updates, as well as interim celebrations will go a long way to keep people focused and motivated.

Provides A Variety Of Incentives: Not all employees have the same responsibilities, and not everyone is motivated in the same way.  Successful performance incentive programs include opportunities for all employees to “win,” regardless of the type of work that they perform.  And including different types of rewards (a choice of either “cash” bonus, gift card, or a day off, for example) ensures that there’s something for everyone in achieving the goal(s).

Delivers Rewards In A Timely Fashion: The greatest satisfaction in achieving a goal occurs when the goal is realized, not a month after the fact.  And timely acknowledgment more directly connects the achievement itself with the reward, providing additional incentive to win another time.  Make sure that your performance incentive program provides for prompt recognition of achievement.

Includes Employee Involvement: Incentive programs developed by top managers only without the involvement of employees are likely to be not as effective as when there is employee involvement.   The people performing the job are often best positioned to know what is an appropriate range is for actual and stretch goals. Also seek employees’ opinions regarding types of incentives that will truly motivate them.

Reflects Business Goals And Company Values:  Remember that performance incentives are a very effective way to reinforce the goals and objectives you have for your business, as well as to remind people of the company’s overriding values.  Get the greatest impact from your performance incentive program by ensuring that it rewards performance consistent with that vision.

Should you need help thinking through an approach that will work best for your organization contact CAI’s Advice & Resolution team today.

Rick_Washburn circle

Rick Washburn leads the Advice & Resolution team at CAI. In his role, he advises executives and HR professionals on strategic and organizational issues, tackling subjects ranging from employee engagement to talent management. With his 25 years experience in HR management, Rick is uniquely poised to advice and lead businesses to successful HR strategies.