Getting More from Your Employees (If you think your workers are motivated without consequences, think again. )

Getting More from Your Employees

If you think your workers are motivated without consequences, think again. Being a good leader means providing checks and balances.

"Average" isn't good enough any more. Not in this competitive environment. Not in this lagging economy. If you accept average performance from your employees, you're doing your company a huge disservice.

So why is it then that so many of us mutely accept mediocre performance? Perhaps because raising the bar isn't easy. Taking corrective action can be unpleasant. And if you haven't done any of this before, it may not be clear how or where to begin.

One place to begin is with the 20-60-20 percent rule. It goes like this: rate the performance of nearly any employee group, and you'll find the population divides itself into three categories:

20 percent are strong performers

60 percent are average performers

20 percent are weak performers

You have three possible places to begin, but which one's most critical? Here's a clue: your strong performers are already doing fine under your current management, so don't waste time fixing what isn't broken. We'll come back to them later.

That leaves your average performers--your majority--and your weak performers, a smaller but more dangerous group. Whom do you start with, and what do you do?

The good news is you can kill two birds with one stone. Research has shown that when you start vigorously managing your weakest employees, it makes the biggest impact on your next group up--namely, your average workers.

If you aren't taking action against underperforming employees--employees who aren't productive, who come in late and waste time or perhaps don't come in at all--what message does that send to the average worker?

It tells them that there are no consequences for performance. Remember, your employees are well aware of one another's behavior, even if management pretends not to notice. This fosters a culture of apathy and negativity that drags everyone down.

On the other hand, if you start holding underperformers accountable, many of your average employees may just step it up a notch, all by themselves.

There are a number of ways to manage poorly performing employees. Start by creating job descriptions and performance standards for everyone--a step many small employers wrongly overlook.

Job descriptions are incredibly useful tools. They tell employees what's expected of them. They give you a standard for measuring performance, a must when it's raise and bonus time. And they protect employers against wrongful termination suits, because now you have a specific tool for documenting problems.

If someone isn't performing well in his or her job, figure out why. Is it a training issue? If so, make training available and you may solve the problem. Is this person a good worker, but poorly suited to his job? Then see if there's a more appropriate role for him elsewhere in the company. Or does she simply have very poor work habits? If no matter what you try, you can't motivate her to improve her performance, you need to do the toughest thing of all: terminate her.

"Neutron Jack" Welch, the former CEO of General Electric, is famous for his extreme managerial practices. In the 1980s, Welch insisted that each year, every department manager rank his or her personnel and eliminate the bottom 10 percent of workers. His theory was that it raises performance expectations and keeps everyone--even stellar employees--on their toes. Fear of losing one's job is powerful motivation.

While Welch's practice was radical, it's also radical--dangerously so--to keep non-performers on board. Plain and simple, they are hurting your business! Cut them loose, and you'll send ripples throughout your organization, shaking up other non-performers and prodding average employees to aim higher. As a bonus, you'll boost morale among your top performers, because it shows that you're paying attention and that you value good work.

According to an old Icelandic proverb, "Mediocrity is climbing molehills without sweating." If you want to climb mountains, not molehills, develop a zero tolerance for mediocrity. Use the 20-60-20 percent rule to keep your employees moving upward.

Centralized Purchasing – Good Or Bad?

Centralized purchasing is the control by one headquarters department of all purchasing that is undertaken by a business. This allows for central management and volume purchases that lead to better prices and terms as well as the ability to work with larger suppliers.

This central control enables more efficient inventory control, lower staffing costs and a decrease in overheads. Staff also benefit with better training and support and the ability to build better relationships with suppliers.

While this may seem obvious, many large companies either have grown quickly and organically or have grown via mergers and acquisitions. This means that they often have several separate purchasing departments that are each responsible for purchasing a group of products.

Advantages of centralized purchasing:

• Allows for fewer overheads.
• Duplication of staff efforts and resulting costs are negated and all activities are standardized.
• Many staff no longer have to spend time on low level ad hoc purchasing.
• Volume purchasing means that better prices, greater discounts and more agreeable terms can be obtained.
• Volume deliveries cut down on delivery charges and staffing costs to move and store the goods.
• Computerized systems can be used to automate much of the work as well as integrate the purchasing systems with accounting and stock control.
• Centralized records can be kept of all purchases.
• Staff can be trained in purchasing and how to minimize costs.
• Suppliers know where and whom to contact which makes supplier contact much easier.
• Purchasing staff can build good relationships with the buyers that enable the supplier to understand the business need and suggest other products that may be more suitable and cost effective.
• It allows for better control of inventories so that they can be kept at optimum levels.
  

Disadvantages of centralized purchasing:

• Purchase requisitions for ad hoc goods have to be sent from other areas to the purchasing department causing delays and some irritations.
• If the company is very geographically diverse, it may not be able to take advantage of local discounts.
• The centralized purchasing department may become too large and complex to manage.
• Conversely, with a small company it may not be cost effective to have staff and a computer system that only deals with purchasing.
  

As you can see if you are a large company that is not too geographically dispersed the advantages of a centralized purchasing department far outweigh the disadvantages

4 Tips for Creating a More Effective Supply Chain

Successful warehouse management requires you to maintain an effective supply chain. Many manufacturing and distribution companies, however, struggle with how to go about streamlining and improving upon their current supply chain. The process can be an expensive and arduous task, especially if you don’t know where to begin. While we cannot do the work for you, we can provide you with a few tips to launch your supply chain initiative.
The following list reflects the habits of the most successful and effective supply chains:
1. Create a written strategy and update it often.
While it may seem like common sense, few manufacturers actually maintain a supply chain strategy in writing. While budgets and objectives are beneficial, companies need to focus on developing a strategy in order to improve their supply chain.
What, exactly, is a supply chain strategy? In short, it’s a plan designed to help supply chain leaders decide how they will allocate their scarce resources over a period of time. Many companies also include an assessment of their strengths, weaknesses, opportunities and threats in their supply chain strategy. Regularly updating your strategy will help you gain a better view of your supply chain and develop solutions to problems that arise.
2. Align your business with your supply chain.
Sales and Operations Planning has made it easier for companies to align supply chains with the business. However, companies often lose track of the importance of this alignment due to critical operational pressures and additional factors.
Make sure that those higher up in your manufacturing company realize the importance of aligning your supply chain with the business and make it a top priority.
3. Make decisions based on facts.
In order to find true success, companies need to develop a “fact-based” culture. Rather than accepting assumptions at face value, employees need to dig for factual evidence. Managers and executives need to stress the importance of fact-based analysis among supply chain teams in order to improve success in logistics.
4. Take advantage of the latest technology.
The most successful supply chains incorporate technology such as warehouse management systems (WMS) and mobile warehouse management applications into their strategies and warehouses. Using mobile devices and mobile apps, can help you streamline key supply chain operations and save time (and money) along the way.
The top performers are more aggressive and smarter users of technology because they know that the competitive advantage comes early in the technology cycle. Companies that adopt technology after it has matured are merely catching up to companies who have already mastered the technology. Stay ahead of the game and adopt early. This will guarantee your future in the global marketplace, as well as give your supply chain a boost.
Effective supply chains also regularly assess their software implementations to determine if there are any capabilities that they own but are not currently using or if they should consider investing in additional technology to improve their value. Ensuring your systems and processes are in top shape will not only help you are get your money’s worth from your warehouse management software, but it will also help you create a more effective supply chain.