Ross: The real secret to a happy workforce
You’re familiar with the idea of companies having Chief Happiness Officers. It’s the latest effort to keep employees happy post-COVID. It’s good that companies want to show their appreciation – even though it sometimes comes across as forced fun – but when employees get asked ‘how can we make you feel appreciated’ they’ll say, well you know, donuts are great, but a little more money would be nice too.
Unfortunately, more money is probably not going to happen when we’re in this fight against inflation, because stopping inflation requires increasing productivity.
But what if sharing the wealth DOES increase productivity?
Take a look at today’s story about the private equity firm KKR – Kohlberg Kravis & Roberts. Their business is to buy up companies, make them profitable, then sell them off.
Usually, when you hear about deals like that, you figure it’s the employees who get screwed.
But back in 2011, KKR started a new policy – that when it bought a company, employees would get a stock ownership plan as a free benefit. And not just management – it would also include the hourly employees – the ones who actually do the physical work. They got shares of stock at no cost to them.
One of the companies KKR bought was CHI Overhead doors, which sells garage doors. Not a glamorous product, but, as it turns out, a very profitable product. According to the Chicago Tribune, KKR paid $600 million for the company in 2015 and, this week, sold it for $3 billion.
And because of the stock plan – about 630 employees will get checks averaging $180,000.
And some of the company’s senior truck drivers – who are the highest-paid hourly workers, will see checks in the area of $800,000.
But what’s important here is that the motivation to do this wasn’t just about being nice.
It was to make more money. KKR believes the incentive of giving employees stock made them more engaged, stable, and less likely to quit – which, as it turns out, results in extremely good overhead doors that bring in a lot of money.
I hesitate to say that greed is good, but if companies can get richer by giving employees a cut of their success … that sounds good to me.
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