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  #1  
Old 06-27-2014, 01:35 AM
GatorGardener GatorGardener is offline
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How to fix a spoiled company culture?

New to the forum - checking to see if anyone has ideas on this problem:

I took over our family business last year (25 employees) and have realized that the majority of employees are badly spoiled. They were treated extremely well over the past 20+ years, given annual raises every single year without fail of between 50 cents and a dollar an hour each, and now accrue large quantities of PTO as well.

I'm all for treating employees well and compensating them more than the competition to ensure we have the best employees on our side. However, I've begun to try to correct some issues - like reducing guaranteed overtime of 10 hours a week to 2.5 hours a week for all employees, and I've encountered fierce resistance and attitudes, which is expected. The real problem though now is that the employees are the best compensated by far in our market but they perform quite poorly due to the bad morale related to the cutbacks of some of the perks they've had.

I'm not sure what to do to fix this issue except to entirely clean house, which is not ideal as I would lose a ton of valuable experience and knowledge of client accounts.

Here are some of the compensation related issues I'm dealing with that are absolutely killing our bottom line:
Maintenance crew foremen at $20 an hour pay (even though they don't have driver's licenses)
Pay for a full day on all rain days even if they leave work at 10am.
Many long term employees with 4-5 weeks vacation time a year.
Guaranteed OT for all employees of 3 hrs a week in the winter and 10 hours a week in the summer.

I had a senior foreman challenge me last week in front of the other employees when I changed one of these policies and I fired him, and am already feeling the loss of his experience. But I see no other option available unfortunately for these guys that feel like I'm screwing them by trying to turn around the company.
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  #2  
Old 06-27-2014, 07:00 AM
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wbw wbw is online now
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What part of the country are you in?

Are you profitable?

Involve the employees in finding solutions to specific problems. Would they prefer you thinned the ranks so that those left work a little harder and keep what they have?

If you are profitable and not in danger of going under, then I would make subtle changes. They will add up.

Put yourself in their shoes. Use them as part of the solution.
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Old 06-27-2014, 07:15 AM
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snomaha snomaha is online now
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Quote:
Originally Posted by wbw View Post
What part of the country are you in?

Are you profitable?

Involve the employees in finding solutions to specific problems. Would they prefer you thinned the ranks so that those left work a little harder and keep what they have?

If you are profitable and not in danger of going under, then I would make subtle changes. They will add up.

Put yourself in their shoes. Use them as part of the solution.
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My thoughts also - what % are you dropping to the bottom line?

Don't envy you - changing a company culture is one of the tough ones. We use open book management and are very transparent with our team members. Aside from our general laborers, I want everyone to have a general knowledge of how $ flow through a business. This has helped with the notion that I fill up a truck full of $ every day.
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Old 06-27-2014, 09:38 PM
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94gt331 94gt331 is offline
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Quote:
Originally Posted by snomaha View Post
My thoughts also - what % are you dropping to the bottom line?

Don't envy you - changing a company culture is one of the tough ones. We use open book management and are very transparent with our team members. Aside from our general laborers, I want everyone to have a general knowledge of how $ flow through a business. This has helped with the notion that I fill up a truck full of $ every day.
Just curious on open book management? Does this mean you show all your team members the finances, bills, how much you make on each job, and what your costs, etc, etc are? I find that to be a interesting idea, especially in this buisiness where you need your guys to work hard to keep the bills paid on a day to day basis. This year I started being more open with the things going on in the buisness so they are in the know more, and that really helped alot with the employee morale, allways thought about opening the books to my team, just wasn't sure about that yet.
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Old 06-28-2014, 10:06 AM
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snomaha snomaha is online now
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Quote:
Originally Posted by 94gt331 View Post
Just curious on open book management? Does this mean you show all your team members the finances, bills, how much you make on each job, and what your costs, etc, etc are? I find that to be a interesting idea, especially in this buisiness where you need your guys to work hard to keep the bills paid on a day to day basis. This year I started being more open with the things going on in the buisness so they are in the know more, and that really helped alot with the employee morale, allways thought about opening the books to my team, just wasn't sure about that yet.
We start the year with an annual strategy planning session. Division managers, their key people and some administrative staff are invited. The previous year is reviewed and financial goals and the strategy to hit them are recorded.

We have a weekly meeting where each division managers P&L is projected up on a screen in our conference room. They are expected to break down the P&L based on goals they have in place for the year/quarter. Specifically, they are responsible for sales, materials and direct labor. At the end we look at the whole company financials - so 100% transparent with that layer.

The division managers share a collapsed version of the P&L with their next layer, be it an account manager, foreman etc. This is done on a monthly basis, usually over lunch.

When it comes to much of our direct labor, it's blank stares when discussing financials. I did try an interesting exercise once with a cross section of all divisions. I had two employees come up to a large white board with very generic P&L items written without numbers. They were given $100 that represented the previous years total sales. Then in front of their peers we asked questions like - how much did we spend on materials and supplies? - how much on insurance? - how much on fuel? They had to give me dollars back based on the % of sales the specific line item was. At the end of the exercise they had $8 dollars in their hands - I then asked for $3 more to cover taxes. I then spent a few minutes explaining that the $5 left over was needed to fund growth - you service debt with after tax profits. Pretty cool experience for those who were there, you could see a couple of light bulbs turn on.
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  #6  
Old 07-02-2014, 08:08 PM
recycledsole recycledsole is online now
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Quote:
Originally Posted by snomaha View Post
Don't envy you - changing a company culture is one of the tough ones.
Yes and yes. what more of a difficulty. did it for a few years before I started my business- but I was middle management. the one taking all the heat without getting backed up- basically on my own. that is why I quit. however with you, you have the say.
Sorry my lack of management and insight into your particular situation I cant give you much advice.
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  #7  
Old 06-27-2014, 07:05 AM
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southerntide southerntide is offline
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Tell them to shape up or get out, hard workers are hard to find but still out there now more than ever looking for work unemployment is still super high and downplayed in all media and statistics.

I got people calling about jobs more this year then clients seems lol
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  #8  
Old 06-27-2014, 07:40 AM
whiffyspark whiffyspark is online now
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Originally Posted by southerntide View Post
Tell them to shape up or get out, hard workers are hard to find but still out there now more than ever looking for work unemployment is still super high and downplayed in all media and statistics.

I got people calling about jobs more this year then clients seems lol
In landscaping?

If he takes that advice he'll ruin his family business
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Old 06-27-2014, 07:13 AM
whiffyspark whiffyspark is online now
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Don't mess up what you have. If you're business is profitable your family knew what they were doing.

This is exactly how you lose everyone and go under
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  #10  
Old 06-27-2014, 07:21 AM
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gcbailey gcbailey is online now
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For what it's worth... Around here there was a pretty good sized muffler/tire shop that was family owned. Had over 30 employees. The father retired and the son took over, just over a year later they went under. The son had all these grand ideas that he thought was better than the tried and true methods that his father had used for over 25+ years.

If wages are hurting your profits you need to work with the employees not against them.

It doesn't matter how much work you have coming in, if you don't have guys that know how to do the job, you're screwed.

Honestly, for every 20 comments you'll get on this thread maybe 3 of them are worth putting any thought into. I'd be weary of making any company decisions based on complete strangers.
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