Posted Monday, May 18, 2009 by Mark Harbeke

 

As we get ready to host Mike Foley, CEO of 2007 Top Small Workplace Reflexite Corporation, for a webinar on "Two Perspectives on Succession" on May 27, I'm looking over my notes of a webinar that Mike presented for us a year ago, "Building an Ownership Mentality Among Employees." In that session, in which Bill Marshall of fellow 2007 winner Phelps County Bank also lent his time and expertise, Mike revealed six elements that make up their ownership culture at Reflexite, a Connecticut-based manufacturer of optical components and film with over 500 employee-owners spread across 22 locations worldwide and over $80 million in annual revenues.
Here they are:

1. Share ownership with all employees, worldwide – employee stock ownership plan (ESOP) started in 1983; average ESOP account of $120,000; "international ESOP" phantom plan mirroring U.S. plan
2. Participative management – open-book management with training on the financials and monthly updates at all sites; engage employees on key decisions including Board elections and managing change
3. Specialized communication techniques – In addition to open-book: frequent meetings, monthly meetings at all sites by business leader, quarterly meetings in person at larger sites by CEO, web simulcasts, town meeting approach to major decisions, goal to answer all questions
4. Share rewards – includes both short term such as on-time delivery and reducing customer returns (continuous improvement) and long term: ESOP allocation tied to annual business performance
5. Confidential employee opinion surveys – leadership especially watches voluntary participation rate (historically at 90% or above) and comments for firm-wide improvement
6. Specialized training at average of 40 hours/year/employee – on areas including company quality system, personal financial management, effective communication, stress management, negotiation, and team leader skills

Notably, with the exception of the ESOP and open-book components necessitated by Reflexite's nature of ownership, virtually all of the above elements can be adopted by businesses that don't want to implement an ESOP, but yet still wish to enjoy the benefits of having employees think and act like owners.  And isn't that every company?