Making the most of your People – Dumping the Dollops and Cheering the Champions
10 November 2004
How ‘wired up and fired up’ are your staff? Are you getting the most out of your people? Can you afford to be under performing by 35%? If your firm was losing £4.7million each year through poor people management, would that gain the Partners’ attention?
We all know that successful firms focus on developing and communicating with their staff to help the business win that competitive advantage. They:
- focus on the energy, drive, understanding and commitment of everyone in their business
- create business relationships with clients which are virtually impossible for their competitors to copy or break because of the quality, empowerment and energy of their staff
- sell their brand internally as well as externally – to ensure everyone understands what is valued by the organisation, and are sincere and genuine in all they do…. Because:
“Organisations who value their people are rare”
This is about the firm’s ability to retain staff and so provide exceptional service to clients. External branding only works if you focus on Internal branding as well – capable people distinguish businesses.
Our thinking has had to shift. Success is the difference between aspiring to a culture and providing a climate in which people thrive and develop ‘can do’ attitudes to their jobs. You are able to match the external brand (culture) with the internal reality (climate). By doing this you stand a better chance of keeping key staff, who in turn command client loyalty.
For example over the last two decades our culture has significantly changed by the environment we live in – just look at how mobile phones, for example, have changed the way we communicate on a near hourly basis – anywhere in the world.
How can you tell if you have got it right? Well over the years, as a result of analyses into Professional Services Organisations, we have identified how HR can link Key Performance Indicators (KPIs) that affect profitability and show whether there really is a Return on Relationships – emotional capital. For example:
- a regional office of a national law firm, with approximately 550 partners and employees, had staff turnover at 30%, equivalent to nearly £7 million loss (made up of recruitment and lost opportunities costs, lost chargeable time, lack of productivity, etc) – there was no real commitment to staff;
- Another firm with 250 staff identified that through poor promotion processes, they were losing people at critical points in their careers, such as 3 and 5 years PQE. Limited career development and career structure reflected little consideration of individual goals.
Clearly some cost is unavoidable; there will always be some staff turnover, or sickness and people will have variable performance.
The Human Resources Department can support Heads of Department, Team Leaders, Partners and Managers by providing details of and explanations about;
- Staff turnover (including retention of new staff)
- Costs of advertising and recruitment through agencies, the Internet, newspapers, etc.
- Areas of sickness which reflect a lack of motivation, repeated illnesses (that require further investigation) and repeated doctor and dentist appointments
- Management time spent on recruitment, induction, performance management and coaching – and what outcomes are achieved.
Analysis of these KPIs often highlights poor delegation, ineffective performance management, inaccurate time recording, unclear communication and, of course insufficient use of other professionals in the practice, e.g. HR, Marketing, IT or Finance.
Another firm with approximately 320 staff and £24 million turnover decided to analyse why they were only getting only 67% utilisation from their fee earners. By interviewing a sample of staff and senior managers over 5 days, looking at staff turnover, sickness and absences, cost of recruitment and the often overlooked or hidden ‘lost opportunity costs’ of Partners time, we identified they were losing £4.7 million each year.
Currently 27 fee-earners, working at full capacity with no discount on fees, achieve no profits – just £4.7 million to cover these costs.
If the firm could save even 25% of this cost, it would allow them to employ 18 more staff and generate additional income of nearly £3.5 million nett!
Now did this latter firm have Dollops or Champions? We looked at this business in the context of Return on Relationships - emotional capital, which is about how to gain buy-in from managers and staff alike. You need both their:
- Intellectual buy-in or understanding, i.e. minds and
- Emotional buy-in which is commitment and drive, i.e. hearts!
If you plotted these two axis, Intellectual buy-in on the left (bottom – top) and Emotional buy-in at the base (left to right), it produces a quadrant. We looked at the staff and found the following classic types in the business, developing strategies to help them all get closer to being Champions!
- Observers, (top left)
These are people who understand the purpose of the latest quality or branding initiative, but hold back their involvement as they are cynical about its success. This lack of involvement can often lead to a diminution of the success of the project – and so the Observer can turn around and say: ‘told you so’!
- Mavericks (bottom right)
Absorbed in their own plans and schemes, Mavericks have loads of energy and drive – it is just hugely misdirected. Holding on to that enthusiasm and steering them onto the firm’s overall course is an art in itself – but possible.
- Dollops (bottom left)
Well, years ago Dollops used to have energy and enthusiasm. When you employed them they had great skills. However, over the years they have been belittled, made to feel ineffective, or yet again you have told them how should do their job – so now they let you do all the work! Everyone is retrievable – these people need to be valued again – and the sickness and under performance will turn around.
- Champions (top right)
Not everyone can be a Champion all the time – but many have the ability to contribute with complete intellectual buy-in and energy. Use your Champions to build an infectious success in your firm and everyone will benefit.
Few of us get out of bed each day and say: ‘Today I am going to do everything wrong!’. Within HR and the Management team there is scope to encourage and develop people so that they are all high performers to the best of their ability. The HR department has a huge role to play in helping firms develop this awareness of the importance of the Return on Relationships - emotional capital, its impact on retaining clients and generating profits.
If you would like to learn more about these audits, contact Patricia Wheatley Burt or the team at, Trafalgar, a management consultancy which focuses on helping firms manage and motivate staff to achieve greater profitability and success. She and the team may be reached at: - email@example.com; or 020 7565 7547
Trafalgar – The People Business Limited
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