Got Operating Problems?

Employees may have solutions — if you ask for their input  

Your management team doesn’t have all the answers — and they may be aware of only a fraction of the problems. Rank-and-file workers can provide simple but effective solutions, but they may need an incentive to speak up.

Learn from frontline workers

In March, Widgets ’R Us lost two major accounts. The sales manager blamed it on quality control issues. The plant manager blamed procurement for switching suppliers of raw materials. Marketing thought the company’s prices were too high compared to competitors’ prices.

Widgets’ owner decided to survey frontline factory workers and customer service reps about ways to improve customer retention. Instead of playing the blame game, these workers had practical solutions from their daily observations.

Based on employee suggestions, the owner realigned workflow on the production line to be more streamlined. These improvements eliminated bottlenecks and sped up the manufacturing cycle time by 10%. Then she negotiated a long-term contract with a low-cost domestic vendor that was willing to supply raw materials on a just-in-time basis. This lowered inventory carrying costs by 4% and improved the gross margin by 6%.  

She also received an eye-opening fraud tip: A disgruntled former salesperson had sold stolen customer lists to an unethical competitor. So, the owner spoke with her attorney about investigating the breach and implemented stronger controls to prevent other employees from stealing valuable proprietary data in the future.

Because of these changes, Widgets’ profits are up in the second quarter. And no additional customers have been lost since March.     

Engage employees

How do you motivate employees to speak up? Some companies implement a cash reward program for suggestions that add value. Consider these guidelines:

Be goal oriented. You don’t want to be inundated with complaints. Make it clear that you’re looking for ideas that promote the company goals and add long-term value.

Provide a measurable benchmark. Tie rewards to financial results, such as cost savings or revenue growth. For example, if a suggestion saves the company $40,000, a 2% reward is $800.

Acknowledge contributions. Announce people who receive rewards at a companywide meeting or award ceremony. This shows employees that the incentive program is important to your organization.

Go beyond surveys. Solicit feedback from a variety of sources, including emails, bulletin boards, hotlines, newsletters, town hall meetings and departmental groups.

Listen and implement changes

Everyone wants to be heard, regardless of whether they’re the CEO or the janitor, full-time or part-time, rookie or veteran. When your employees have the courage and initiative to make suggestions, pay attention and acknowledge their input, even if you decide not to act. Doing so can broaden your management team’s perspective, empower workers and improve productivity.

© 2018