Ch-Ch-Changes

Just gonna have to be a different man.

Time may change me; but I can't trace time.

David Bowie’s hit from the ‘70s could be an anthem for the current times. Companies have been forced to adjust, adapt and ally in ways never envisioned before. Take a look at how some companies are making the change...

• Pulte (for sale housing) appoints Avalon Bay CEO (for rent housing) to its Board of Directors. Could this portend a move into rental housing for volume builders?

• National homebuilders Lennar and Toll Brothers open real estate investment funds for distressed properties. Evidently, REO = ROI.

• Westinghouse teams with Lennar on solar homes. Too bad “Sun City” is already trademarked.

• Panasonic considers building smart homes in one of their Japanese factories. An app is sure to follow.

• The Bill & Melinda Gates Foundation funds a $42m initiative to reinvent the toilet. No kidding. Talk about being flush with money.

• Google invests $280m in SolarCity to help homeowners put in solar panels. And, they’ll know where and how you spent every kilowatt.

• DR Horton launches new micro-home project (Division 43) on a 1/3 acre, urban infill site. No job too small for this industry giant.

• SunCal trades development services for 180 acre tract of land. Why buy when you can barter?

It's Not About the Money

The constant stream of negative news in our industry makes it difficult to motivate employees and sustain morale. To borrow a line from “American Pie” (the song, not the movie), there seems to be a lot of “bad news on the doorstep”. It’s become a daily challenge for owners and executives to keep their teams focused and energized. However, don’t think hope has taken the last train for the coast; there are steps you can take that are simple, sustainable and require little or no money. Read on...

Understanding What Truly Motivates People

A really smart guy by the name of Dr. Frederick Herzberg led a study in the 1960’s and identified six factors that truly motivate people.

• Feeling of Achievement
• Recognition / Status
• Continuous Learning
• Responsibility
• Meaningful Work
• Advancement Opportunity

These motivators become self-evident when employees take the initiative without being asked, go the extra mile or become intensely focused on their work. And, they vary from person to person.

Notice how money is missing from the list above? That doesn’t mean it’s not important. Herzberg found six drivers that aren’t motivators but when overlooked, lead to dissatisfaction among employees. He calls them “hygiene” factors:

• Salary / Compensation
• Job Security
• Supervision / Mentorship
• Policies / Procedures
• Work Conditions
• Interpersonal Relationships

What You Can Do

First things first: let's recognize that two of the significant Hygiene factors– Salary and Job Security, are big question marks at the moment. As much as you would like to pay your employees more or assure them job security, the market conditions might not support it. That’s the cold, hard truth so no need to dance around it.

However, there are many things employers can do for their employees that have nothing to do with that. As Dr. Gary Williamson, an industrial psychologist with PSP Metrics notes, “Five of the six motivators have nothing to do with money or promotion, therefore there is no reason (for an employer) to not provide them.”

• Step 1: ask your employees to force rank what matters most to them among the following motivators: Feeling of Achievement, Recognition / Status, Continuous Learning, Responsibility, Meaningful Work.

• Step 2: do the same exercise for the Hygiene factors that you as an employer have control over: Supervision / Mentorship, Policies / Procedures, Work Conditions, Interpersonal Relationships.

Remember, these twelve drivers vary from person to person and can change over time. Recognition and Achievement might be high on the list for someone in his/her 30’s but shift to Meaningful Work as they mature. Your goal is to learn what really matters most to each employee today... the top 1-2 drivers for them in both categories that you CAN control... and do something about it.

Want to learn more? We came across this entertaining video that demonstrates what we’re talking about. Enjoy! http://www.youtube.com/watch?v=u6XAPnuFjJc

Credits:

• “One More Time: Answers for Motivating Today’s Employees”, Dr. Frederick Herzberg, courtesy of PSP Metrics.
• Dr. Gary Williamson, Managing Partner, PSP Metrics, Pittsburgh, PA

What Makes Companies Successful

Ever wonder what makes some companies more successful than others? Some insights were offered by David Gardner (cofounder of the Motley Fool) in an interview with business writer Will Deener. Gardner's stock picking strategy includes more than just what's on an income statement or balance sheet. The financial data has relevance, but he places as much or more emphasis on the following: what really makes a company tick...

• What is the company’s culture?
• What is the value of its brand?
• What is the personality of the management team? Does the CEO embrace a sense of humor? Tip: people perform better when they work with people they like.
• Is the company innovative and creative?

Gardner: “It may be hard to express those things as a number, but they’re a lot more tangible and real than a lot of things on an income statement. If you can’t make people smile or laugh, it doesn’t mean you’re a bad person, I’m just not interested in your company."

Regarding the ability to innovate or be creative: Gardner likes to invest in companies that have the ability to disrupt competitors through innovation. Example: Netflix, which blindsided its main competitor (Blockbuster) with a different delivery model of the same product. Since entering the movie rental arena in 2004, Netflix share have risen from $17 to $220 while Blockbuster struggles to reinvent itself and simply survive.

PS: if innovation is something you thrive on, check out Different by Youngme Moon. It's chocked full of case studies similar to the Netflix example.

Timesharing Your Expertise

Had an interesting discussion with a survivor from the RTC days. In the late ‘80’s, this gentleman was laid off from a civil engineering firm he’d worked with for the past ten years. Full time jobs in his field were in short supply and when they did surface, the competition was fierce due to the oversupply of candidates. He landed a few consulting assignments here and there while he continued his search for a full time position, but nothing of a consistent nature. He desired a more certain future... if not a full time job, then at least some type of recurring work he knew he could count on and look forward to. Any of this sound familiar?

Well, the solution he came up with proved to be unique, timely and cost efficient. Rather than pursue piece-meal assignments on a scattered schedule, he “sold” his services for one day a week to four companies, none of which needed a full time employee but all needing extra help. Just as today’s companies are doing more with less people, these companies could easily justify this arrangement to avoid overloading their regular staff. Plus, they knew what they were getting in terms of expertise each week and tailored the workload according to this person’s skill sets.

Our friend didn’t replace his income 100% nor did he reap the benefits of a full time employee, but the fractional strategy helped him survive the recession of the late ‘80’s. He also expanded his sphere of influence by working with four companies vs. one and was able to use them as references when the need arose. Best of all, he no longer faced the uncertainty of what lied ahead in the weeks to come.

There’s something for companies to learn from this story, too. We’ve made this case before: there is an amazing wealth of talent sitting on the sidelines, just waiting to be tapped– if not permanently, then part time. Not just line staff, but senior level executives from companies known for best practices. What would your company gain by hiring the former Corporate Controller from a national real estate developer for one day/week for a few months? Or, the former VP of Customer Service from an award winning home builder? Tap into the brain trust while it’s available.

How to do that? Well, we’ve got some ideas on that which we’ll be sharing soon. Stay tuned.

Drilling Down on Steve Jobs

We've said it many times before: if you really want to understand a candidate you must dig deeper than their initial answers. It's called "drilling down", and while it may sound interrogatory, it simply means understanding the Who, What, Where, When, Why and How to an answer. The exercise has equal value in sales situations: solicit this information from your customers and it becomes much easier to address their needs.

A good example is provided by Bill Conaty and Ram Charan, authors of "The Talent Masters". Imagine how helpful it would be to understand Steve Jobs... as a candidate or customer... to the degree described in this post.