What if your employees could see behind the curtain of how the company is run?
Tony Schroeder, as shown in this video, took this approach with surprising results. “They know every line item on all those financial statements have a story,” and Tony expected them to know it.
For 22 years, Tony has led Choice One Engineering, a civil engineering firm based in Sidney, Ohio, as President. He now serves as the firm’s CEO. Tony is also a Business Advisor at Aileron, a non-profit organization that helps private-business owners find greater success. Tony has developed and maintained a company culture of trust, responsiveness, enjoyment, cooperation, and success at Choice One. “We were trying to get people to act and think like owners,” explains Tony. For Choice One, that meant a form of open book management. The first step required equipping employees to know more about the story behind the numbers.
“We had education. We had an 8-hour seminar, led by me, on what financial plans are.” To this day, they continue this kind of education on a weekly basis so that every employee is aware of how to measure, track and improve the ROI, and the ongoing performance of the company.
Thinking & Acting Like Owners
Because they’ve been given the opportunity to learn the drivers behind the company’s financial statements, everyone at Choice One recognizes that each line item tells a story. They also know how those numbers relate to the health of the business.
With this kind of transparency, employees feel highly involved in the business, allowing them to think and act like company owners in daily decision-making. Open book management also helps them fully participate in the planning and implementation of the company’s strategic plan for business, culture, and future growth.
Maximize the Potential of Employees
Greg Harmeyer, founding partner and CEO of TiER1 Performance Solutions, has also created a culture that maximizes the talent and potential of his employees. TiER1 Performance Solutions helps other companies improve performance, so it’s important that they have a healthy company culture where employees are informed, involved, and engaged.
Greg explains this mindset is part of why the company went through the process of becoming an ESOP, an employee stock ownership plan. (An ESOP is a retirement program that allows participating individuals to acquire ownership interest in their employer’s company.)
This structure was a fit for the organization for many reasons, explains Greg. “The ESOP was a win across the board for us. It gave existing ownership a graceful, intentional diversification strategy, it gave the company a long-term defined, stable future, and it has perfectly complemented our culture where employees felt a sense of ownership already,” he explains.
Strengthen the Ownership Culture
“The ownership mentality—from the perspective of our culture, our brand, and our relationships with clients and our communities—already existed. The ESOP strengthened it by creating a heightened sense of responsibility to each other,” explains Greg.
In an ESOP, knowing that your individual decisions affect a long-term investment influences your mindset. “Knowing that your co-workers, colleagues and friends have an investment that is affected by decisions creates an even greater sense of responsibility and accountability.” An ESOP was also a fit for the company because they’ve always been fully transparent. “We share everything about the strategy, relationships, performance, financials, and more, with everyone. Knowing that you are trusted with all information creates a deeper engagement and sense of responsibility,” he explains.
“We spend a lot of time talking about our purpose and our values and the impact we have on each other, on our communities and on the world,” says Greg. Making the purpose of their work very prominent creates greater meaning for everyone, and gives people something that they want to have ownership in.
“Everyone wants to make more money. But if you can cultivate a mission and purpose that people can personally connect with, they will use their own discretionary energy to own it and embrace stewardship necessary for it to grow.”