I’ve got a friend who works at a bad company. For various and sundry reasons, they don’t feel it’s the right time to make a move to a new job. Interestingly, It used to be a pretty good company. Over the years the company grew from a small outfit to a fairly large business with dozens of locations across the world. As much as the owner/founder tried to maintain the small company culture, the environment, as one would expect, became much more corporate with all the good and bad that brings. Then the hammer really fell. The owner/founder decided to act on their exit plan which, unfortunately, led to a private equity buyout. This is what turned it from a fairly average company, at least as it relates to the quality of the employees work life, to the miserable experience typical of a private equity buyout.
As I’ve been through a private equity buyout with all the misery involved, I’ve become somewhat of a therapist for my friend. I’m sure it’s not healthy for me as it occasionally forces a relapse of my private sector PTSD. It does allow me to really reflect on their experiences over the years as it relates to my own. I started to think about the idea of a perfect company. A perfect company is like a perfect relationship, it doesn’t exist. That being said, some can be much closer to a person’s ideal than others. Also there are some traits that are fairly universal insomuch as that they benefit the majority of people. I really started to think about what makes the perfect company, at least from a quality of life perspective. I came up with a list that I think will work for most people.
Before I go into the list, I do want to make a point about the uniqueness of companies as it relates to the uniqueness of people. For some people, those who are very type A as an example, they may thrive in a highly competitive environment that demands 60-80 hour work weeks. They may be workaholics who love the thrill of a “kill or be killed” culture. Obviously, for the majority of people, this is simply not the case. In this article, I’m talking about the elements that benefit everyone, no matter if you are a CxO bound ladder climber or a clerk who wants to do nothing more than push papers and go home at five.
TRADITIONAL “BIG THREE” EMPLOYER BENEFITS
I’ve talked about the big three employer benefits ad nauseum. They include Personal Time Off, Retirement and Health Insurance. Obviously these have to be well funded and high quality. I work for the state and I will admit that the state is as close as you could expect to perfect when it comes to two of these benefits. With retirement the state offers a traditional defined benefit pension plan and a comprehensive defined contribution 401K plan. Participation in the traditional defined benefit pension plan is mandatory, which makes sense when you consider what pension plans are. The 401K is voluntary and could only be improved if the state also offered a match. I’ll admit that it’s hard to justify another employer retirement investment as the state does put a great deal into the pension plan, but in a perfect world, both would have a match. This would have the benefit of making sure everyone gets a solid retirement as well as rewarding those who wish to be extra diligent.
The second thing the state gets right is paid time off. There is both a longevity benefit and equity with the PTO plan. Like most employer plans, the longer one works for the state, the higher level of earned PTO they get. This really works well when it comes to workers who are aging and have greater demands on their time. An example of this is caring for elderly parents or taking advantage of life opportunities that require more consecutive time off. The other major benefit for the state’s PTO plan is the equity element. If you don’t use your vacation, it gets banked via the sick leave program. That sick leave can be converted into early retirement days. This both encourages and rewards employees to not take advantage of the PTO plan if they don’t need to take time off. If you stay on the job, take minimal time off, you can retire months early. In truth the only way the plan could get better is if more senior employees who are hired in from the outside are granted the benefits of those who have been with the state for decades. I like rewarding work longevity, but I do think longevity in a career should be rewarded, not just longevity to a single organization. I think this kind of program, where PTO accrual is matched to years of experience for new employees, is a great tool to promote additional flexibility for the state’s workforce makeup.
The final one is healthcare. Unlike retirement and PTO, this is the one area I have some criticisms, at least for those who have children. For the most part, healthcare is comparable to a good private sector company’s plan, and as such, it’s ok for the individual worker, but it’s a fairly large burden for a worker who is head of household for a traditional family and having to insure them all. At last check the cost was $600 – $700 additional per month. Even for the higher earners in the state system, this is expensive. It’s a scary amount for those on the lower end of the wage scale. Additionally, and perhaps unsurprisingly considering the healthcare mess in the US, the plan is overly complicated. The number of different options and coverage loopholes and out of pocket expenses is rather obscene. Still, like I said, the state health plan may be a little messy, but it’s about as good as you can get in our modern world.
So, for the big three employer benefits, I think the State of North Carolina offers a pretty good template for what would be needed to be a perfect employer. Clearly, there are other facets that make up a perfect employer beyond these big three benefits.
EQUITY
I think equity is the biggest indicator. Over the years I’ve noticed that the more equity the employees have in their company, the higher their overall quality of their work life. It’s also something the state has a hard time offering beyond the equity it offers in it’s PTO plan. This is because the state is owned by all the people in the state and is a non-profit entity. So beyond time, when it comes to private for-profit organizations, equity should also equal a reasonable share of the profits and growth in the value of the organization. Profit sharing and stock options are a must! Equity should also be shown in seniority, even if it’s just longevity pay bumps. In a perfect world, the for-profit company is owned by it’s employees, or it could be structured so that they have equal board level decision making with outside investors. I’ve never seen a corporation where the employees owned a significant chunk of equity in the company as a bad place to work. In fact the opposite is true, they are usually the best places to work, which is why equity is my number one indicator of the theoretical perfect company.
INVESTMENT INTO PEOPLE
Investment into the people who work at an organization is another good indicator. I’ve been with many companies that provide required training, or training that are no-brainers for liability sake. An example of the latter is safety training in a manufacturing plant. The training is much less expensive than a lawsuit. These companies will position their messaging to employees like it’s a big and unique benefit for them. To me this isn’t really investing in people, it’s doing the least possible while marketing it like it’s the most.
So what does real investment into people look like? It’s hard to say specifically because of the tremendous variations in companies and work environments, but common traits for good investment include both formal and informal training, coaching, and career planning, and it should be targeted at everyone inside the organization. It should go well beyond what’s required by law or common sense.
This doesn’t mean that everyone needs to be on a track to become a senior manager. Wanting to stay in one’s position should be as respected as wanting to move up. The key is that everyone should be proactively engaged with regular opportunities for high quality enrichment and advancement. The big benefit for the organization is that they can build the people they want and need, they don’t just rely on driving their recruiters crazy when a team’s need is critical enough for a budget to be allocated to allow for a new salary on the books.
Most HR professionals will be quick to say that this kind of culture within an organization leads to benefits for both the organization in question as well as the individuals within the organization. It’s a near perfect win-win. It’s also something that can reverse job hopping on the part of the employees.
Great Communication
Communication, great communication, to employees, customers, and other stakeholders is another good indicator. Too many organizations are managed on a ‘need to know’ basis which I personally believe happens because of a natural equilibrium with management. Not sharing information until you absolutely know what you are sharing is properly vetted is a safe way to manage information. Unfortunately it also usually means it’s coming out too little and too late. Remember, when stakeholders are kept in the dark, then uncertainty plus anxiety leads to sensemaking, rumor, and speculation.
Great Communication should be consistent, timely, proactive, and frank. Leadership should always be as transparent as possible. That can’t be understated. Bad news should be shared as much or more than good news. Developments and decision making, including the process at which the decisions are being made, should be shared. More communication is always much better than less communication. It’s that simple. People like to know where they stand and nobody ever wants to walk into a meeting and get a shock that changes their life.
Flexibility
Flexibility can be very easy for the organization to implement or very challenging. If your organization is a manufacturing facility that has to have an assembly line running 24/7, then having people around to operate that line is critical. Since everyone has to work together they have to show up at the same time. That makes it almost impossible to design a system so that people can work when they want. I’ve seen some manufacturing organizations who attempt flexibility by allowing some employees to split a full time job, but the hours still remain fixed. I’m sure there are other ways to drive flexibility into a rigid system, but it’s always going to be very difficult. This is one of the reasons why manufacturing gets such a bad rap. It’s inflexible.
An example of the opposite to the inflexible job is one with almost complete flexibility, both geographically and temporally. A good example of this is software development. If you get your time in every day, it doesn’t matter what hours you are working or where you are working them from. Another option is research or senior management.
Strong Mission
I’ve always felt that for most employees an organizational mission statement is meaningless. It’s like making everyone watch the same pre-recorded twenty year old sexual harassment training annually. No matter how many times the employee population views the recordings it changes nothing. The scumbags are going to be scumbags and sexually harass people, and everyone else is wasting an hour every year. The whole point of the “training” is in case the company gets sued, they can claim no liability. The mission statement is very much like this. The leadership may trot it out on occasion, but usually, especially when it comes to for-profit companies, the mission statement is complete bull. It’s either an outright lie, overly broad, or completely forgotten. An example of a lie is when the mission statement says something about delivering excellent customer service, but the real mission is driving profitability.
When the mission statement is used correctly it is applied where it makes sense and is used on a day to day basis. Ideally it should be so ingrained into the organizational culture that it’s deferred to whenever there is a complex decision at hand. It should be used with this type of decision making by virtually all layers of management. If even the first line managers are asking “Which one of these options best meets XYZ part of the mission statement?”, It really helps an organization stay focused, and it makes the mission statement a real thing. For the employee, it helps them understand their environment much better. The better they understand it, the more they can commit to the organization and its mission. This makes the work way more than just a J-O-B.
Consensus Decision Making
I’m a bit conflicted on consensus decision making as an indicator for a perfect company. When used properly, it really helps with things like inclusion, staying true to the culture and mission, and furthering alternative ideas. The negatives to having multiple people make decisions is that decision making can be delayed or groupthink can take over. In the end I decided to include it as something to look for when searching for the perfect company becauseI took it to its logical end. If I had the choice where I worked for a company where every decision was autocratic or a company where every decision was a group decision, there is no contest. I’d always pick the company with the consensus decision making.
No company or organization is perfect
Everyone can have a bad experience even at the best of companies and everyone’s idea of the perfect company is different. That being said, I think when you look at these traits of the perfect company, there are a couple of things that pull it all together for the vast majority of the workforce. One of them is that the company or organization maintains a long term view in it’s actions. When you care about where both the organization and its people will be in ten or twenty years, it’s easy to see that you will treat them well today. Yes, you always have to be focused on the needs of the day or the quarter, but the decision making should always include a consideration of the long term.
The second thing goes back to the first indicator. It’s equity and equality. Equity in the production, sharing in the decision making, and equality between the needs of shareholders and those of employees. When that equity exists, the company winds up serving everyone pretty dang well. This is opposed to serving some people very well (short term shareholders) and everyone else getting screwed (employees, customers, et. al.)
To simplify and personalize it, when someone really cares about me as an employee, when they genuinely value my opinion, when they let me have some say in my working environment, and, when they reward me for my efforts beyond just a paycheck, then I’m really going to care about them as an employer. I can’t think of any job more perfect than that!
This article was inspired by:
https://seths.blog/2021/03/public-companies-are-always-out-of-alignment/
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