How to Profit From Understanding

by Greg Phillips

A couple of topics that are often discussed in various forums are the talent shortage (and what recruiters refer to as a ‘candidate-short market’) and staff retention. If you are in a HR, Training or Leadership role, this won’t be news to you. So, what do you do about this? The two topics are interrelated in that, in a candidate-short market, it is even more critical to retain talent. Again, not news.

There are a variety of psychometric and behavioural profiling tools available to assist in the professional development of people. Whether you use these types of tools or not, there are valuable lessons to learn from some of the regular outcomes, which are achieved when these tools are used well. One of the most valuable outcomes when we profile a team is that people gain an understanding that we are all different. You might say, well everyone probably already realises that we are all different. True, however the reality is that most people don’t stop and think about what that means.

You need to really work through it and have people realise that they need to understand that, because their behavioural type is different to others, all sorts of things can be misunderstood e.g.:

  • Communication – both giving and receiving
  • Intentions
  • Interpersonal styles
  • People’s abilities

Let me share a couple of stories, which underline this dramatically.

I once did some work with a national retail chain and some outstanding performance improvements were made simply by improving understanding between the personnel. One of the Store Managers was about to be demoted to 2IC. I convinced the National Retail Operations Manager to wait until we had finished our program. Upon looking into the reasons that this Store Manager had found himself in trouble, I found that mostly the problem was due to his boss, the Regional Manager, being dissatisfied with the merchandising and housekeeping standards of the store. The financial results were satisfactory though it was believed that they could be better with the correct standard of merchandising.

Here’s what I found when I investigated:

  • The merchandising and housekeeping were appalling.
  • The Store Manager had been with the company 15 years.
  • The Store Manager held company shares (publicly listed company).
  • The Store Manager loved the company and by any measure was a ‘Company Man’.
  • The staff were happy and liked the Manager and each other.
  • Other than the housekeeping and merchandising, the staff were quite efficient.

In a nutshell, I formed the view that the problems were not associated with intent or lack thereof. This is important to know because it defines the problem as being either ‘attitudinal’ or ‘skills’. It was clearly a case of lack of skills. I enlisted the assistance of the Regional Manager who was an excellent merchandiser and he trained the Store Manager in the required skills. It would appear as though we had fixed the problem, right? Unfortunately no. Despite a number of attempts by the Regional Manager on store visits to ‘drill in’ the standards to the Store Manager, little improved. In fact, the Regional Manager would leave the store looking good only to return a week or so later to find a shambles. Hmm, this wasn’t working. Again, the Regional Manager was ready to demote the Store Manager. You might say, “Who could blame him”. The thing is, I was convinced this problem could be resolved. As I said to the Regional Manager, “Are you ready to give up on a guy who is clearly conscientious, company orientated and who works hard?” Further understanding of the problem was required. Cutting to the chase, what I found was that although the Store Manager had all the right intentions and knew the required standards, he didn’t have the skill to communicate it to his staff. Now, you can if you like, say that if someone doesn’t have all the skills, they shouldn’t be a Manager and I would respect your right to be wrong.

Give me someone who has most but not all the skills and has the right attitude, intent and work ethic and I’ll back them any day against more highly skilled people without the same attitude, intent and work ethic.

The solution was simply to train the staff in the necessary standards so that they could carry out their duties. Admittedly, in the ideal world, the Manager would do this however what do you do if the Manager doesn’t have this particular skill? You have 2 choices:

a)      Demote the Manager

b)      Deal with it and take advantage of the Manager’s other attributes

In this case, choice b was taken. The result?

The Retail Operations Manager said, “I’ve never seen that store look so good”.

Revenue and profit improved dramatically.

The store won the National Store of the Year award!

Another example of understanding involving the same company was a store where many of the staff were working against each other. The simple fact was that staff in different departments thought that staff in the other departments had it easy. While the staff within each department were reasonably content with each other, the inter department relationships were quite dysfunctional including the relationship between the departments and the administration office.

The number of ways people can make life difficult for others even when they don’t work in the same area are countless. For example, when retail staff would come to the office to get change for the register, the Office Manager would deliberately make them wait unnecessarily just to show them how busy she was. Of course, often the customer was also kept waiting and there are the obvious productivity issues, not to mention the effect on morale.

In short, all that was required to fix the problem was to get all the staff together and have them understand that none of them had it easy; that every role contributed to the store and the customer experience. The new level of understanding that was created propelled the store forward to an amazing level. In the previous financial year this store had contributed $58,000 net profit (after head office costs) to the group. In the “year of new understanding”, the store contributed $540,000 net profit (after head office costs). That’s not a typing error. That’s right, more than 9 times profit improvement!

I’m sure you can also imagine the effect on retention given the much improved working conditions and morale. I’m sure everyone these days knows that a good working environment has a huge impact on staff retention. So many organisations lose sight of the fact that good working conditions doesn’t just mean the physical environment or that there is coffee in the kitchen. It’s about relationships and good relationships come from understanding.

There are many areas where understanding is important and where there are common misunderstandings:

  • People’s potential
  • Working relationships – between individuals, departments, locations, administration……
  • People’s roles
  • How people can best contribute to the organisation
  • What is expected of me?
  • What can I reasonably expect of others?
  • What can I reasonably expect of the organisation?

Etc. etc. etc.

So, get yourself a little understanding in your organisation and watch your profits soar.