At the 2016 Annual ESOP Association’s convention in Washington D.C., Aaron Moberger of Harpoon Brewery and Matt Hancock of Praxis presented a workshop on continuous improvement programs. Continuous improvement programs address the question many employee-owners have: ‘What can I do to create value for my ESOP?’ All employee-owners in an ESOP have a vested interest in the overall performance of the company because they all share in the profits. Often times at a staff level it is not clear what employee-owners can do to help improve performance and increase profitability, outside of continuing to perform their job to the best of their ability.
Establishing a means for employee-owners to generate and champion ideas for improvement allows for each employee-owner to tangibly contribute to the growth of share value. Continuous improvement programs come in many forms but the main goal is, as the name indicates, a program established to collect and implement ideas to improve processes, procedures, and operations within a company. This results in increased efficiency and ultimately increased profitability. These programs strengthen the ownership culture within an ESOP and garner increased employee-owner participation. This is done through the use of tools, structures, and processes, which enable employee-owners to personally champion solutions or improvements, directly driving results.
Continuous improvement programs take many forms and should be tailored to each individual ESOP. Some programs utilize groups to drive improvement. A few examples include wellness and sustainability committees, improvement teams, and self-directed work teams. Other programs focus on individual participation. These might include a passive idea collection, like a suggestion box, or active idea collection such as hosting idea-generating workshops or ‘brownie for your thoughts’ events.
Here at JCJ we utilize both forms of continuous improvement programs. In addition to an online suggestion box, we have a number of committees tasked to review and improve everything from the technical and design side of our projects, to sustainability and project management and delivery. Employee-owners who are interested or highly involved in a certain aspect of the company are encouraged to participate in these committees and tangibly contribute to the improvement of company performance.
Aaron Moberger of Harpoon Brewery presented his company’s experience with the creation and implementation of a continuous improvement program, and spoke about the lessons learned, challenges encountered, and keys to success. Where there is no existing program in place, or a company is looking to implement a large change to its program, the process can seem daunting. Rather than launching the new or improved program company wide and working out the bugs as you go, Aaron suggested creating a pilot program for one department or group of people in order to refine the program’s processes and implementation. He also suggested kicking off the pilot program and subsequent company-wide roll out with several idea-generating workshops comprised of smaller groups of individuals.
Before a company-wide roll out of a new or improved continuous improvement program, provide training for supervisors on how to foster an environment within the company that encourages the submission and championship of ideas by all employee-owners. Keep in mind that responses with only ‘yes’ or ‘no’ to a suggestion, will discourage employee-owners from participating in the program. The same applies to delayed or slow responses. In addition, allowing the program to become a one-sided complaint box must be avoided. Establish guidelines for submitting ideas, and timelines for responding to them. Ideas should be accompanied by proposed solutions and kept in a centrally accessible location, whether as a hard copy or electronic.
Management support for the program is key to its success. Employee-owners with suggestions for improvement should be encouraged to champion his or her idea and must be allocated the overhead time necessary to investigate, develop, and implement it. Reward employee-owners for both submitting ideas and implementing improvements. One way to do this is to feature and recognize employees for their ideas and contributions in a visible way. In addition, employee-owners who submit exceptional quantity or quality of ideas, or who successfully implement ideas that increase profitability, might be rewarded by having breakfast with the CEO or another similar event.
Both Aaron Moberger and Matt Hancock gave great advice on the do’s and don’ts of continuous improvement programs and how they can be used to strengthen the ownership culture within an ESOP. Continuous improvement programs, like many procedures and processes within a company, will benefit from continuous improvement, so keep the ideas and suggestions rolling in.
Article by Sara Miller, Assoc. AIA, GGP, GPCP