1. Charles Sterling, Ph.D. San Francisco How to Build and Keep the Team You Want June 21, 2003

2. 2 Mercer Human Resource Consulting Life is Easy, Right? High unemployment means you have your pick of the very best employees available Employees are grateful—thrilled even!—to come to work everyday All worries about losing your best employees evaporated when the labor market turned Any concerns you had about paying your employees appropriately have gone away—they’re happy just to have a job!

3. 3 Mercer Human Resource Consulting No? You’re not alone! – Good leaders and successful business owners realize the truth behind the statement “Our employees are our most important asset!” – How do you translate that statement into a reality for your business? Let’s begin our journey.

4. 4 Mercer Human Resource Consulting Begin with a Vision

5. 5 Mercer Human Resource Consulting The Importance of Vision Why stay with a company if you don’t know what it’s purpose is? Why get out of bed in the morning if you don’t know the importance of what you’re doing? Don’t think that vision, or mission statements, are trite just because so many companies do them poorly According to Ken Blanchard*, “Having a vision means being so clear about your purpose, so committed to it, and so sure about your ability to accomplish it, that you move ahead decisively despite any obstacles.” *For additional information on this subject, see Ken Blanchard and Jesse Stoner (2003), “Full Steam Ahead!”

6. 6 Mercer Human Resource Consulting Essential Elements to the Vision Significant Purpose – Answers the “Why” question; gives employees an understanding of what the company is here for Clear Values – Answers the “How” question; provides guidance around the question “What do I want to live by?” Picture of the Future – The picture must be that of the end result, something you can actually see. It focuses on what you want to create and envisions the end result.

7. 7 Mercer Human Resource Consulting Rewards

8. 8 Mercer Human Resource Consulting A Framework for Understanding How Rewards Work EffortPerformanceOutcome ExpectancyInstrumentality (Valence)

9. 9 Mercer Human Resource Consulting Rewards Need to be Right Many elements of rewards that need to “Be Right” – Mix of pay (base, short-term incentives, and long-term incentives) – Benefits – The work experience

10. 10 Mercer Human Resource Consulting Pay is Complex “Pay” has many different components that affect how people perceive—and relate to— their work – Starting salaries – Base pay levels – Merit increases – Promotional increases – Short-term incentive targets (including commissions) and payouts

11. 11 Mercer Human Resource Consulting How do you Address this Complexity? Know thyself – Start with a philosophy of pay that’s aligned with your mission statement and how you value your workforce  Address issues such as: ­Pay levels relative to the external labor market ­Balance of base pay relative to incentives ­Fiscal responsibility of your pay program ­Legal defensibility

12. 12 Mercer Human Resource Consulting How do you Address this Complexity? Know thy neighbor – An enormous amount of data is available from commercially available surveys – Find out what salary surveys your competition participates in, and participate in them yourself! – Consider an industry-specialized survey for highly unique jobs

13. 13 Mercer Human Resource Consulting How do you Address this Complexity? Seek out guidance and support – Developing pay programs sometimes requires specialized experience generally not found within a typical human resources department – Assistance can—and should be— highly customized; the result should be simple to understand and easily administered

14. 14 Mercer Human Resource Consulting Go Fishing! Bringing fun, passion, focus, and commitment to work For more information, see “Fish! Tales”, by Lundin, Christensen and Paul (2002)

15. 15 Mercer Human Resource Consulting A Compelling Fish Story What was going on here? Was there a larger story for workplace success? The workplace experts spent time getting to know the operation—filming the engaging environment, talking to the customers and the workers—and found a compelling and fascinating story based upon four basic principles they call the FISH! Philosophy.

16. 16 Mercer Human Resource Consulting Principle 1: Play! Work made fun gets done, especially when we choose to do serious tasks in a lighthearted, spontaneous way. Play is not just an activity; it’s a state of mind that brings new energy to the tasks at hand and sparks creative solutions.

17. 17 Mercer Human Resource Consulting Principle 2: Make Their Day When you “make someone’s day” (or moment) through a small kindness or unforgettable engagement, you can turn even routine encounters into special memories.

18. 18 Mercer Human Resource Consulting Principle 3: Be There The glue in our humanity is in being fully present for one another. Being there also is a great way to practice wholeheartedness and fight burnout, for it is those halfhearted tasks you perform while juggling other things that wear you out.

19. 19 Mercer Human Resource Consulting Principle 4: Choose Your Attitude When you look for the worst you will find it everywhere. When you learn you have the power to choose your response to what life brings, you can look for the best and find opportunities you never imagined possible. If you find yourself with an attitude that is not what you want it to be, you can choose a new one.

20. 20 Mercer Human Resource Consulting Conclusion Like all important choices in life, the choice of which company to work for—and the significant effort put forward to excel—is highly complex. Understand that monetary rewards play a significant—but not overly significant—role in the decision to join, succeed, and leave an organization Don’t compete on the basis of pay alone; pay attention to the humanity of your workers

21. 21 Mercer Human Resource Consulting Thank you! Charles Sterling, Ph.D. Mercer Human Resource Consulting Three Embarcadero Center, Suite 1500 San Francisco, CA 94111 (415) 743-8960 charles.sterling@mercer.com Presentation available on the NASPD website