The question for so many business owners is often, “How do I get everyone to work hard, do a great job, stay with the company a long time and really enjoy their jobs?”
These are four priorities that have always been extremely important to me. Ultimately, how do I get everyone to think like and act like an owner of the company?
We are a private, multi-generational family business with a definite goal of never selling. We want to create a business that is truly built to last. We want long-term relationships with our customers and the folks we work with.
About 10 years ago, we were introduced to the term “ownership thinking.” It involved an array of concepts we determined did not exactly fit our business model. However, we loved the term, and went to work creating our own version of what we felt ownership thinking should look like. What we ultimately wanted was for everyone who works at ABC Home & Commercial Services Austin (ABC) to feel and act like an owner. But we wanted to accomplish this goal without giving away ownership in the company.
PROFIT-SHARING AND BONUSES
The cornerstone of our Ownership Thinking program is our profit-sharing plan. This plan is for every person who works at ABC. The profits we share are simply based on the pre-tax profitability of the entire operation. Our company has 21 service lines, ranging from pest to lawn to mechanical, so one of our biggest challenges is how to make our different service specialists all feel part of the same company.
Our profit-sharing plan is based on three criteria: tenure at ABC, individual earnings, and most important, the pre-tax profits of the entire company. This plan is for every employee, and we distribute the annual profit checks at our annual holiday party. Last year, we distributed $2 million to our 850 employees.
We also offer to all employees a monthly revenue bonus that is based on exceeding the previous year’s revenue. For example, if in November we exceeded November 2019’s revenue by 16 percent, all employees will receive a $100 bonus. Our goal is to reward growth and profitability, with an emphasis on the profit component.
COMMUNICATION AND TRANSPARENCY
We communicate our monthly performance to the team two ways: through our monthly company meetings and our ownership dashboard, which is available on our company intranet. On the second Tuesday of each month, at 7 a.m., we hold our company meeting for all employees. We broadcast the meeting live to our branches, and we all participate in the meeting together.
The first thing we share each month are the top-line revenue figures. We break these down by service line, and give a comparison to last year’s same-month numbers. We then share the expense numbers and the bottom-line profit each month, along with the year-to-date figures.
In addition to sharing the revenue and profit numbers, we also share a variety of important numbers and information that reflect how the business is doing that month and year-to-date. These numbers include our days outstanding on collections, our contract gains and losses, our rolling 12-month employee turnover percentage, our vehicle accident numbers, and our workers compensation accident numbers.
We also share our social media review numbers and ratings for each location, our call center satisfaction ratings, our sales team leaderboard, and our leaderboard for leads turned in by service staff and office staff. Last but not least, we share our safe driving leaderboard, along with our most-improved drivers leaderboard.
CUSTOMER, EMPLOYEE FEEDBACK
One of the most important pieces of information we share on the ownership dashboard is our Net Promoter Score, or NPS (Editor’s Note: For more on NPS, see the June “The ABCs of Growth” column: Measure what matters: Customer retention, attraction and satisfaction.). We share this number by service line and branch location, along with the cumulative company NPS. This is a great measure of our customers’ satisfaction, and is simply based on one question: “On a scale of 1 to 10, how likely are you to recommend ABC to a friend or family member?”
The other major component of our Ownership Thinking program is our annual Ownership Thinking meeting. In January or February, we invite all staff in for an evening dinner and meeting. We do this at each branch, too. It is a very straightforward meeting where we break up into groups of 10 and answer two simple questions:
- How do we make the ABC service better for our customers?
- How do we make ABC a better place to work?
This process has yielded fantastic ideas and suggestions that have made ABC tangibly better over the years.
Of course, the concepts of open-book management and ownership thinking are nothing new; there are a variety of books and models out there to follow. For us, though, our modified version has been extremely successful and positive. I truly believe the philosophy and processes the program has given us has helped make ABC a wonderful company and a much better place to work.
JENKINS, who rotates this column with his brothers Raleigh and Dennis, is president of ABC Home & Commercial Services, Austin, Texas. He can be reached at firstname.lastname@example.org.