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Using the Voice of Your Employee-Owned Company
- by Jennifer Briggs from The Rady School of Management
Employee ownership (EO) is a business ownership model, but the best EO companies take this structure and build a participative management structure with it. Employee-owned companies have a unique opportunity to have participative management at two levels - the work level and the corporate citizenship level.
Participative management at the work-team level relies on managers who are great at using the talent of their people to improve the work unit's performance. They listen and include the voice of the worker in day-to-day management. Team huddles and agile project approaches are typically a key aspect of this type of work along with a humble, trusting, participative manager's mindset.
Participative management at the corporate citizenship level relies on leaders who see employees not just as workers but as shareholders of the company. They teach the business of running the business and help employees connect to the voice of the marketplace. They then include their people in generating ideas for the future. They believe that the power of the collective mind is better than a limited group or individual contribution. But, harnessing this power in an effective way takes some forethought and coordination. ... [More...]
Webinar: What is Ownership Thinking?
We are pleased to invite you to an upcoming webinar on engaging employees through Ownership Thinking™ featuring Marc Lacoursiere and Perry Phillips - September 13.
Join Marc and Perry to learn how engaging employees through Ownership Thinking™ training increases accountability and profitability while teaching your employees the fundamentals of business and finance and how integrating the Ownership Thinking™ program with an ESOP will dramatically increase the value of the company and the wealth of all the employee/owners.
This will be followed by a question and answer period where you will be able to ask Marc, President of The Achievement Centre, and Perry, President of ESOP Builders, questions related to Ownership Thinking™.
More information and registration here.
Your Company's Hidden Value & the "Magic Accelerator" - Part 2
- by Vincent Côté, Hero's Guide Inc.
Typically, when someone speaks of growing the value of their business, they are talking about improving their revenue or profit. But did you know there is “hidden value” within your company that can be discovered if you know where to look? Furthermore, there is a magic that happens if you focus efforts on unlocking this hidden value, that acts as a “Value Accelerator”. In part one of this article, we will introduce the Value Builder system. ... [More...]
ESOP Companies More Likely to Use Stewardship Approach to Organizational Culture
- from NCEO Newsltter
Past research indicates that ESOPs with an employee ownership culture outperform both non-ESOPs and ESOPs that have not developed an employee ownership culture. One way to think about the leadership characteristics of these companies is the stewardship model. Stewardship asks leaders to think about the long-term health of their organizations and the individual well-being of the employees in it. That may seem like an obvious idea, but the dominant theory of management is agency theory in which managers are assumed to act in their own selfinterest and need aligning incentives (equity, gainsharing, etc.) to act for the shareholders instead. Shareholder interests, which may be short-term, are paramount.
Results from a recent study conducted by Richard Van Doel, PhD, suggest that ESOP leaders and employees demonstrate stewardship characteristics, and that these characteristics are independent of the role (management or labor) fulfilled by the employee-owner. Based on the findings from the data, stewardship does influence business performance. Van Doel is also president of the 100% ESOP company Performance Validation and is working to start an Indiana Employee Ownership Center.
Van Doel used a sequential mixed method approach (an approach where initial data are used to inform the next phase of data gathering) to explore stewardship characteristics within employee-owned companies in the professional, scientific, and technical services industry. Stewardship characteristics were defined as psychological (intrinsic motivation, organizational identification, use of power) and situational (collectivism, involvement orientation, and power distance) mechanisms that promote proorganizational collectivist behaviors.
Overall stewardship climate is an aggregate measure of the six characteristics of stewardship and is measured by the Stewardship Climate Scale, with a score of < 4 indicating an agency perspective, a score of 4 indicating neutral and a score > 4 indicating a stewardship perspective. The level of stewardship as measured by the senior leaders among the 30 ESOP organizations ranged from a low of 4.33 to a high of 6.44, with a mean score of 5.64, which indicates a stewardship perspective.
To better understand the generalizability of these results to the larger ESOP population, a second study has been initiated to further explore the stewardship relationships in a much larger ESOP sample.
Yogurt "Culture" of Employee Ownership
- from NCEO Newsltter
Danone, maker of yogurt, among many other products, will extend its employee share ownership structure, currently available only to France-based employees, to all of its 100,000 employees worldwide, in a move the company believes will “drive long-term sustainable value creation.” In addition to giving employees the opportunity to have input on strategy for meeting their 2030 goals, the share ownership structure will be widely expanded. Danone CEO Emmanuel Faber explained the program—called “One Person, One Voice, One Share”—in the following terms: “We do have employee profit sharing schemes in limited geographical regions but the big innovation there is that it will be on the global performance of the company. The second big innovation is it will be based on the dividend paid. It’s directly attached to the yield that will be returned to our shareholders, not to the performance of our business per se, so it goes beyond that. The programme will also encompass the broadening of the employee ownership plan that we have in France, which is only for French employees today. We intend to broaden this at the global scale to make sure that through a similar mechanism any Danone employee will have the opportunity, on top of the one share that we will grant to him or her, the opportunity to invest more in the company through this broadened scheme.”
The Millennials Myth
- from NCEO Newsletter
How many times have you heard that millennials view work very differently than their elders (the ones usually doing the comparison, mostly in a negative way)? It turns out this may be more myth than fact. In a new report in Workspan (January 2018), Carolyn Heller Baird of the IBM Institute for Business Value reports on a multigenerational survey of 1,750 full-time employees in 12 countries. Millennials, it turns out, have similar goals and expectations as everyone else. They don’t need more constant acclaim, are not more likely to change jobs, and behave much like other age cohorts on a wide array of measures.
All the Canadian ESOP Guidance You Need in One Book
ESOPs in Canada: How to Implement an Employee Share Ownership Plan to Grow and Exit Your Business with Your Legacy Intact is a comprehensive and practical guide to every aspect of designing and implementing an Employee Share Ownership Plan in Canada.
“This is a must read for those business owners thinking about exploring the notion of employee ownership and discovering that “skin in the game” for those on the front lines of leadership is a secret weapon to surpassing your wildest dreams and forecasts! It is magic”
~ Doug Flynn, CEO, Flynn Group of Companies
More information and order details here
Notable Quotables
"The secret of change is to focus all your energy not on fighting the old but on building the new." -- Socrates, father of Western philosophy
Upcoming ESOP Events
See ESOP Builders events page for details on upcoming ESOP events.
Canadian ESOP and Ownership Thinking Books
ESOPs in Canada: How to Implement an Employee Share Ownership Plan to Grow and Exit Your Business with Your Legacy Intact (2015) by Perry Phillips and Camille Jensen. Buy this book on Amazon or FriesenPress.
The $10 Trillion Opportunity: Designing Successful Exit Strategies for Middle Market Business Owners: A Guide for Professional Advisors - Canadian Edition (2007) by Perry Phillips and Richard E. Jackim. Buy this book on Amazon.
Dr. Carol Beatty's book, Employee Ownership: The New Source of Competitive Advantage (published by Wiley and Sons 2001 - ISBN 0-471-64641-5). Buy this book on Amazon.
Brad Hams' book, Ownership Thinking: How to End Entitlement and Create a Culture of Accountability, Purpose, and Profit (published by McGraw-Hill 2011- ISBN-10: 0071772456 - ISBN-13: 978-0071772457). Buy this book on Amazon.
If you have any questions or feedback (or suggestions for future email newsletter content), please let us know at lisa@esopbuilders.com
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