Workforce Blogs
Home
Complete archive of features and news articles, sample policies and procedures, assessments, and surveys.
Network and exchange ideas with other members in the forums or ask an expert in one of the hosted forums.
Access vendor directories, product case studies and showcases.
Read Best in Shows, view our conference calendar, read commentaries and take our news poll.
The Hot List
Blogs
Topic Channels
Comp, Benefits, Rewards
HR Management
Legal Insight
Recruiting and Staffing
Software and Technology
Training and Development
= Member Only
Workforce HR Jobs
Find A Job
Post A Job



Subscribe Now
Workforce Magazine
Subscriber Help
























= Member Only


Blog: The Business of Management July 2007 Archive
 

July 30th, 2007

Lower Pay=Better Sales?

Macy’s North division seems to be taking a page from the Circuit City playbook (see “More Gibberish from Circuit City,” “Age Bias Suit at Circuit City” and “Running With the ‘Knuckleheads’ “). Not only is the famous retailer struggling to carve out a new identity for its famous State Street store in Chicago—the former Marshall Field’s—but now the company has decided to cut wages and commissions for some sales associates starting in August.

According to the Chicago Tribune, “Macy’s notified employees at its North division, made up of former Field’s stores, that it will cut the range of wages and commissions for some sales associates starting in August and offer voluntary severance packages for those who choose to leave. Macy’s officials declined to be more specific but said the pay model at the former Field’s stores is outdated and out of line with the other Macy’s divisions.”

Consumer behavior expert Britt Beemer told the Tribune that it’s a mistake to lower pay, even for a portion of the sales force, going into the big holiday selling season. The risk of hurting employee morale could overshadow the efforts to attract shoppers into the stores, he said. “Those [marketing efforts] are all nice things, but when I walk in the front door of the store and the employees aren’t happy, am I going to come back?” said Beemer, founder of America’s Research Group. “When you’re a retailer, you’ve got to sell the employees first.”

Cutting pay and commissions seems to be a curious way to motivate your workforce, especially a sales-oriented workforce, as Circuit City has discovered. Is Macy’s seriously thinking that this move will help fix what seems to be a growing problem in the Windy City? Only the holiday shopping season will tell, but I’m betting that this move will backfire in a big-shouldered town like Chicago.


July 27th, 2007

There’s Some Kind of Message Here

They say you can tell a lot about a person by the books they read. If that’s true, what does this list of the top-selling books purchased at last month’s Society for Human Resource Management annual conference in Las Vegas tell you about the HR professional in the 21st century? Can you figure it out:

The Carrot Principle—How the Best Managers Use Recognition to Engage Their People, Retain Talent and Accelerate Performance, by Adrian Gostick and Chester Elton

7 Hidden Reasons Employees Leave—How to Recognize the Subtle Signs and Act Before It’s Too Late, by F. Leigh Branham

Perfect Phrases for Performance Reviews, by Robert Bacal and Douglas Max

Perfect Phrases for Managers & Supervisors, by Meryl Runion

Hot Spots—Why Some Teams, Workplaces and Organizations Buzz with Energy—and Others Don’t, by Lynda Gratton

It’s OK to Be the Boss—The Step-by-Step Guide to Becoming the Manager Your Employees Need, by Bruce Tulgan

Effective Phrases for Performance Appraisals—A Guide to Successful Evaluations, by James E. Neal. Jr.

The Voice of Authority, by Dianna Booher

Ask the Right Questions, Hire the Best People, by Ron Fry

101 Sample Write-Ups for Documenting Employee Performance Problems—A Guide to Progressive Discipline & Termination, by Paul Falcone


July 20th, 2007

Why the Rich Get Richer

I’ve been in the workforce long enough that I remember a time when companies sometimes hired a person even though they didn’t have a specific job for them. It didn’t happen often, and it sometimes turned into a problem, but when it worked, it was kismet.

Here’s how it went, at least in my experience: I would attend a job fair of some sort where I spent a couple of days interviewing and recruiting people who were looking for a job in my industry. It was pretty rare when I found someone who was a good fit for a specific job I had open at that point in time. For the most part, I met people who were inexperienced but promising, and worth tracking for openings somewhere down the road. If you do this long enough, and attend a number of job fairs, you eventually build a pretty nice list of budding young talent that you could convert into real hires somewhere down the road.

Sometimes, however, I came across someone great, someone who would really be a top-flight hire if only I had the right job to put them in. What do you do when you find a great hire but don’t have a job open? Back in the go-go years of the late ’80s and late ’90s, sometimes you could persuade a senior manager to go out on a limb and hire them because they were just too good to pass up on. This is kind of like the thing pro football teams do during the college draft when they go for the best available athlete rather than hiring to fill a specific need. They know, as some enlightened businesses used to know, that sometimes hiring a great person helps elevate the work of everyone around them. And, there used to be a time when companies sometimes bent the budget to do this.

I found myself thinking about this today when reading that Google yesterday reported that it missed its profit target by about 10 cents per share because it hired more than it had planned to in the second quarter. “We overspent against our own plan in the area of headcount, and some of it was … because we hired a little faster than we had planned,” CEO Eric Schmidt told analysts during Thursday’s conference call (Google hired 1,548 people during the quarter, “the majority in sales, marketing and engineering positions,” according to Advertising Age, a sister publication of Workforce Management). “In looking at it we thought, was this a mistake or not? We decided it was not a mistake, that in fact, the kind of people we brought in are so good that we’re happy we did this. As I said earlier, we will continue to watch this very carefully in the future.”

It’s easy to dismiss Google’s decision to over-hire as a luxury that can be indulged when your company has a stock price over $500 and a market cap in excess of $162 billion. That’s certainly one way to look at it. Of course, you can also view this—as I do—as just par for the course with Google, another one of the smart business and workforce decisions that helped to build a mega company with a mega stock price and gigantic market cap. Yes, the rich get richer, but sometimes, they get richer because they are smarter. So it goes with Google.


July 18th, 2007

Bad Behavior, CEO Style

I’ve been meaning to write about last week’s news concerning Whole Foods Market CEO John Mackey, who has put his company’s $565 million acquisition of rival Wild Oats at risk by anonymously attacking and belittling Wild Oats and its CEO on Internet financial forums. Writing under the handle “Rahodeb,” Mackey also anonymously questioned why anyone would buy Wild Oats stock and that the company was probably headed for bankruptcy—just before Whole Foods made its buyout bid.

Beyond the idiocy of a CEO thinking it makes sense to do something like this, there’s another management and workforce issue here. Lynn Turner, the former chief accountant for the Securities and Exchange Commission, hit the nail on the head when he told The Denver Post: “If it was any other employee of the company, he would be fired. The board should fire him.”

Whole Foods has gotten great press over the years, and it clearly has gone to Mackey’s head. Now, the SEC is taking an even closer look at the proposed merger, and the FTC has sued to block the deal on antitrust grounds. As The Wall Street Journal, which broke the story, reports: “It appears from his voluminous postings that at times Mr. Mackey made financial predictions that weren’t readily available from company disclosures to the markets. At the 2006 annual meeting, he told shareholders the company would hit $12 billion in sales by 2010, doubling its sales in five years. Less than a week later, under the pseudonym ‘rahodeb,’ he was even more confident in an online posting: ‘The upgraded prediction of $12 billion is most likely conservative. Won’t surprise me if the number ends up close to $14 billion in 5 years.’ ”

This kind of management behavior is clearly inappropriate, probably illegally, and undoubtedly dumb and foolish. What kind of CEO snipes at his rivals anonymously online and throws in undisclosed proprietary information for good measure? He puts the entire company at risk with his juvenile behavior.

But more important, what kind of example does he set for the rest of his workforce by doing this? Mackey clearly violates a number of the core values of Whole Foods with his anonymous blog posts. Lower-level employees at other companies have been fired for much less on their blogs. Would anyone else at Whole Foods other than CEO Mackey still be employed there if they had done the same thing?

Denver Post columnist Al Lewis probably had the best line on the Mackey-Whole Foods matter, when he wrote: “If someone were planning a special episode of Jackass that starred only CEOs, Mackey would be getting a lot of calls from Johnny Knoxville this week.”


July 17th, 2007

No One Forgets a Great Manager

You know this if you have spent much time in the workforce, but really good and really bad management is impossible to forget. One reader reminded me of this recently when she wrote about my blog item on Northwest Airlines’ management troubles and contrasted them with Delta Air Lines under CEO Gerald Grinstein. Her comments are interesting and further evidence (as if we needed any more) of how far airline service has fallen under today’s shortsighted management:

“I read with great interest your article “Another Airline, Another Meltdown” earlier this month in the 7/2/07 Workforce Management newsletter. I have been a flight attendant since 1970 and was based in Minneapolis-St. Paul for a period of time and witnessed the poor labor relations that Northwest historically had with their employees from the 1960s until now.

“I was also an employee with Western Airlines when Gerald Grinstein helped pull it out of the financial crisis that they experienced in the 1980s. His actions helped my company survive and eventually be purchased by Delta Air Lines. He was a man of integrity then and continues to be so today. Delta was poorly managed by both Ron Allen and the ‘Enron school of management’ style [of] CEO Leo Mullin. Because of my previous experience with Mr. Grinstein, I rejoiced when he lead the coup that ultimately resulted in him being chosen to be the CEO of Delta, a position that he did not for the big bucks that other airline CEOs were paid, but for his love of the airline and desire to see our company survive. He did an admirable job in attempting to keep Delta out of bankruptcy but was ultimately forced to take that route by pilots who refused to renegotiate their contracts and had an outrageous pension plan. I took a major pay cut and experienced dramatic change in work rules, but I trusted the decisions that Mr. Grinstein made. This trust was rewarded when we came out of bankruptcy and Delta’s employees were given bonuses, raises and stock in the new Delta Air Lines.

“It is too bad that other CEOs do not have the integrity that Mr. Grinstein has shown for the 20 years that I have known him. He also did not overlook the fact that when internal customers are happy, customer service improves and customer satisfaction rises, which directly impacts company profits: a balanced scorecard at work.

“Thank you for a very interesting take on the industry that I love.”



Recent Posts

Blog Archives

Categories



Recent Comments

Other Workforce Blogs

Blog Roll







Copyright © 1995-2007 Crain Communications Inc.
All Rights Reserved. Terms of Use Privacy Statement