Basic Persuasion Skills in Employee Ownership

Corey Rosen

National Center for Employee Ownerships

NCEO

What We’ll DoUsing employee ownership to persuade

customersGetting employees to think and act like

owners

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Employee ownership as a marketing toolSurveys in 1980s showed that by

overwhelming margins, customers were positive about buying from employee ownership companies

The “brand” may have been somewhat tarnished by United, Enron, et. al., however.

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Marketing ideas Web site Business cards Advertising and logos Signage Sending employees to trade shows, having them

meet with or visit customers Other ideas?

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Perils of marketing The employee ownership bad boys You have to walk the talk, or would you really

want a United mechanic employee owner to sell your airline?

Employees need to know you’ve sent the message

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Ownership Management It’s very, very hard to motivate people; it’s

easier to provide them an environment where they can motivate themselves

Ownership is a reward, not an incentive Ownership behavior is essential to business

success Lots of small ideas matter (see Ideas Are

Free)

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What Is Ownership Management? A “company of businesspeople” People understand what their ESOP is and how it

works Information about financial, quality, productivity,

and other corporate goals is widely shared Employees have meaningful and regular

opportunities to share their ideas and information about how to make the company better

Core company values guide employee behavior

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OBM: You Want Me to Tell Them What?

Money is the most sensitive of topics; people are reluctant to share financial information about themselves or their companies

Owners and managers fear information will leak to competitors and suppliers

Management doesn’t think employees will understand anyway, and, even if they do, what will they do with this information?

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OBM II: You Want Me to Learn What?

It’s so boring! It’s so complicated! It’s so irrelevant!

I know they’re hiding something anywayThey’re just trying to make use work

harder and accept less payWhat else?

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But Information Is Not Enough It’s not just that you want people to think like

owners. You want them to act like owners. Having a stock plan and knowing how it can

pay off (because you now understand the numbers) can be motivating, but…

There have to be specific, structured opportunities to share ideas and information

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Allowing Participation Is Not Enough

When do I do it?What if I don’t feel confident to express

my idea?What if the boss doesn’t give me any

feedback or puts me off?What if someone else takes credit?What if I get credit?

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Participation Needs Structure

It creates a safe place to share ideas and information

It creates an expectation that people will share ideas and information

It provides something concrete to tweak and change

Attitudes tend to follow behaviors, which tend to follow structures

So how do we get to these new, participative structures?

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It Ain’t Easy Hierarchies are well

entrenched They work well when

the key is efficiency and repetition

They give people a clear career path

They provide a lot of certainty

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But Hierarchies Don’t Work So Well Today

Information flow too critical

Innovation requires more flexibility and freedom

Decisions need to be made more quickly

It’s ideas that matter

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Managing consent Meetings can be

ways to get employees to agree, not to truly generate new ideas

Effective leaders really will take risks

Effective leaders realize they make mistakes

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The Resisters: The CEOFears giving up controlUsed to telling people what to doBeen doing it this way for a long time,

and it’s worked so farAbsent the CEO’s active involvement,

progress will be very difficult

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The Resisters: Middle ManagementThey are required to change the most,

and possibly give up the mostTheir situation is the most ambiguous in

the new corporate orderThey didn’t get to where they are by

being coaches and facilitators; they got there by being good at their job and being decisive

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The Resisters: Non-Management EmployeesSome don’t want new responsibilitiesSome resist ambiguitySome are cynical about any changesSome just don’t like change

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Teams Are Great, But…Many efforts to get employee teams

more involved don’t work well at first – or ever

Teams may tackle problems that they don’t have adequate information or skills to handle

Team authority may be too limited or uncertain

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You Never Get “There” As people develop new skills, they will want

to do more and can do more The same old same old will get routine Management will expect more So “there” keeps moving

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So what does work?Mini-gamesEARSWell-defined teamsBring an idea to work daysWhat else? Group work.