Wake up CEOs: You're about to Lose Your Best Employees
The association, which offers conferences, courses, and publications to 65,000 fitness and wellness professionals, now employs 50 people–including their tech savvy children, Jason, 28 and Kelli, 24. Business is humming. Sales have grown 20% in two years, and profits have quadrupled.
The couple attributes the health of the association to keeping employees happy–a goal for which they find inspiration in CEOs like Richard Branson and Tony Hsieh at Zappos. One of the company’s core values is “exercise your happiness.”
“It’s about creating an ideal wellness community: How are you living your entire life in a happy healthy way?” says Peter. IDEA Health and Fitness Association provides opportunities for its fitness-minded team to meditate, take yoga classes and go on walks during the workday. It installed stand-up desks, so staffers could escape the unhealthy effects of prolonged sitting. The company maintains a wellness committee, made up of employees. Every six months the committee conducts an anonymous survey to get a read on the mood of the staff. “Peter and I really care a lot how happy employees are,” says Kathie.
“I don’t think most CEOs realize that productivity suffers incredibly if employees aren’t happy,” says Peter.
He believes his company is an outlier–and he’s right.
Most employees face such dismal work environments today that working for bosses like the Davises–who’ve embraced “core values like “do the right thing,” “learn and thrive” and “appreciate everyone”– isn’t even conceivable. A 2012 survey by Towers Watson found that just over one-third of workers today are “highly engaged.” Most of the others were various shades of miserable–”unsupported,” “detached” or “disengaged.”
“Employees everywhere–in recessionary as well as growth economies–express some level of their concern about their financial and professional security, their stress on the job, their trust in their company’s leadership, the support that they receive from their managers, and their ability to build their careers,” the report explains. “Many have been doing more with less–for less–for over half a decade, and that reality doesn’t seem likely to change soon, if ever.”
Why? The relationship between companies and their employees is in tremendous flux, thanks to pressures like globalization and slow economic growth. Many corporate bosses now live a life that’s dictated by short-term concerns alone, as I see it. Essentially, they’ve got to “make their numbers” every quarter or they’re out of a job. When that’s your true focus (despite the brown bag lunches HR plans for your direct reports about achieving work-life balance) you don’t have the luxury of thinking about the bigger picture, like whether you have alienated most of your team along the way or that you’ve created an office culture that no one can endure without taking Prozac. Because workers correctly feel like they are treated like a commodity, and not human beings, productivity and customer service suffers–and it gets harder and harder for the company to achieve its goals.
The Davises, 57, have a strong incentive to run their company the way they do: They have a much longer term perspective than the typical corporate manager. As owners, they want to keep working together at IDEA Health and Fitness Association, alongside their kids, as long as they can. “If we’re not going to retire, why not create an environment we can enjoy for the next 20 years, instead of being in the normal corporate mindset?” asks Peter.
Many corporate managers and executives won’t stay with one company their entire careers, even if they want to. As they build seniority and bigger salaries, today’s short-sighted employers will want to replace them with younger people who earn less. These leaders know they’re considered disposable, so it’s probably unrealistic to expect them to get invested in building a positive, sustainable culture in the way that the Davises are.
Nonetheless, there are some signs that more executives are starting to question the harsh values of the business world that have come to seem normal in the employer-friendly job market of recent years–and this could bring some positive changes for their employees.
Miriam Hawley, founder of the group that wrote Our Bodies, Ourselves, recently co-authored a book about entrepreneurial couples called You & Your Partner, Inc., with her husband and business partner, Jeffrey McIntyre.
Hawley, a psychotherapist, is now bringing some of her insights to Harvard Business School, where, through the couple’s coaching, consulting and leadership training business Enlignment, Inc., she is working with “heads of companies who are at crossroads and are at stuck points,” she says. Some have gotten so caught up in meeting corporate demands that they’ve neglected their families and lives outside of work for years. They know they need to change.
“They’re suffering. They’re not taking care of themselves. They’ve sold themselves to the corporation,” she explains. “They can’t be the type of leaders they could potentially be if they are not leading their own life well. Corporations are having to look at that, and I think some are.”
I’ve been hearing similar observations lately from others who work with big-company execs. Hopefully, some of these leaders will bring a fresh perspective back to their offices, so their direct reports can have a personal life, too.
And maybe some will opt out of the corporate grind altogether, like the couples in her book, and apply their prodigious business skills to starting companies where both people and profits matter, like the Davises.
If the health reform actually does result in affordable premiums (and that’s still a huge “if”) it’s going to be easier for talented people who are tired of shabby treatment by corporate employers to quit and set up shop on their own. I co-founded a site for independent professionals called the $200KFreelancer, and I can’t tell you how many people have told me they’d like to go out on their own but can’t afford to buy health insurance–or have had to take a job with benefits after freelancing for a while because they can’t pay insurance premiums. (It’s a big ticket item: My family now pays $36,000 a year in New Jersey).
The looming taxes about to hit higher earners will also cause some two-income families to rethink whether working in corporate jobs still makes financial sense for both partners. A $250,000 income that leaves a family with a lot of disposable income in Peoria, Ill. or Twin Falls, Idaho doesn’t go very far in places with high-cost-of-living, high-tax locales like New York City or Alexandria, Va. It may be more profitable–and less stressful–for one parent to start a work-at-home business to reduce steep outside costs like childcare. Who is likely to depart? Someone with the track record and relationships in an industry that make it possible to get up and running quickly in a new business–the very type of person most companies need on staff.
If the rainmakers in companies start leaving, it could put pressure on employers to create a better, happier work environment so others don’t jump ship. We can only hope.