O.C. Tanner Company White Paper
EXECUTIVE RECOGNITION SUMMIT 2010 Leaders discuss how to create teams and cultures that deliver results Effective leadership in the 21st century is not about leaders and followers but nurturing people through encouragement and opportunity. Creating teams that passionately work together to pursue a shared vision can set a company apart. These themes permeated the sixth annual Executive Recognition Summit hosted by O.C. Tanner in Vancouver, B.C. Canada. More than 100 senior leaders from global companies gathered to share insights, challenges, and results of implementing recognition strategies within their organizations. The key learning: Building up people, leading out authentically and with purpose, and creating highperformance teams—are not soft concepts. But rather, strategies that deliver real business impact.
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The invitation-only summit opened with insights from Dave Petersen, Chief Executive Officer of the O.C. Tanner Company. Keynote speaker, Bill George, retired chairman and CEO of Medtronic, bestselling author of True North, and professor at Harvard Business School encouraged all in attendance to realize their purpose and potential as leaders as they move employees forward. Scott O’Neil, the president of Madison Square Garden Sports spoke about the power of three, followed by a special presentation from Steve Mesler, one of the Olympic Gold winners of the U.S. four-man bobsled team. An afternoon panel discussion was led by Mike Ferone and Lina Zvonar of Bank of America, Jacinta Nelson of Norton Healthcare, and Ralph Polumbo of Albany International. Bestselling authors Chester Elton and Adrian Gostick were on hand to launch their latest New York Times bestseller, The Orange Revolution. The conference ended with the presentation of the Carrot Culture Award to Pepsi Beverages Company, accepted by John Berisford, Senior Vice President of Human Resources. Now in its sixth year, the Executive Recognition Summit has become the premier event for executives and HR thought leaders. The Summit offers a rare setting for senior executives from a broad range of companies to come together to discuss the challenges they face managing and leading thousands of employees around the world. This paper offers a recap of the events of the 2010 Summit and reviews how many of these companies are tackling workforce challenges in the midst of today’s economic climate; how they’ve managed to move ahead by investing in people.
BUILDING UP PEOPLE TO ACHIEVE GREATNESS
Dave Petersen, CEO, O.C. Tanner Dave Petersen, CEO and conference host O.C. Tanner, opened The Executive Recognition Summit by asking leaders to consider what it takes to build up their people. What recognition strategies will have the most impact to drive and spur achievement?
DAV E P E T E R S E N
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“Over the past year, I have been out there talking with many of our clients,” said Petersen. “I wanted to get a sense for what is working, what is making a difference. As we enter this third year of a devastating economy, I’m interested in what leaders are doing that makes sense. For as leaders we all face similar challenges, we have to define a vision and lead out, and we have to deliver on our promises; promises to our clients, to our shareholders, and to our employees. He asked the leaders present to think of their own people, what they’ve been asked to do during these challenging times, and the impact that has had, not just on their employees but their families as well. “I recently read an article by Clayton Christensen in the Harvard Business Review. In it, Clayton describes seeing in his mind’s eye, one of his managers leave for work one morning with a relatively strong amount of confidence, happiness, and self-esteem. Then he pictures her driving home to her family, 10 or 12 hours later, feeling unappreciated, frustrated, underutilized. He imagines how profoundly her lowered self-esteem and dissatisfaction affects the way she interacts with her own family, perhaps her children,” said Petersen.
“The vision in his mind then fast-forwards to another day, a better day, when she drives home after a long day with greater self-esteem, feeling she has learned a lot, been recognized for achieving valuable things, and played a significant role in the success of some important initiatives. He then imagines how positively that affects her as a spouse and as a parent.” “His conclusion is this: Management is the most noble of professions, if practiced well. No other occupation offers as many ways to help others learn and grow, take responsibility, be recognized for achievement, and contribute to the success of a bigger team and a bigger purpose.” “More and more, MBA students go to school thinking that a career in business means buying, selling, deal making, and investing in new companies. That is unfortunate. Making deals does not yield the awards that come from building up people. As leaders, as employers, we are all in the people business. So how do we build up our people? How do we authentically lead them, serve them, help them, and engage them? Are we aware of the impact that we have, not just on our employees but on their families and their communities. Are we paying enough attention?” Petersen then reminded the leaders in attendance that this event was about the people who work for them. People who want to contribute. People capable of great work. They just need leaders who provide opportunities for personal growth, who foster an environment where employees are recognized and appreciated for their dedication and hard work.
AUTHENTIC LEADERSHIP FOR THE TWENTY-FIRST CENTURY
Bill George, Bestselling Author and Harvard Business School Professor Named “One of the Top 25 Business Leaders of the Past 25 Years,” the retired chairman and CEO of Medtronic, Bill George, delivered an inspiring keynote focused on the need for leaders to define first for themselves, then their employees, the greater cause of their organizations. For successful leaders, he summarized, “create cultures that motivate with opportunities, purpose, and vision.” BILL GEORGE
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“What are the challenges in motivating people authentically? As a leader you can’t motivate if you are not authentic yourself. And that’s something you can’t fake. Today, leadership has changed rather dramatically because people have changed,” said George. “We don’t have leaders and followers anymore. If the people who work for you don’t know more than you do, then you better get some new people! People don’t stay with the same company for 40 years, they move on. And if you don’t provide opportunities they will move on faster. For people today don’t want to be rule followers; they want to have an opportunity to show what they can do.” “You’ve got to turn people on to what motivates and what does not. Is it money? If you create a culture as Wall Street did, where money is the only thing, then it’s never enough. For how much is enough? Is it $100 million, $500 million? Money is never enough if you are not using other things. One of my professors just turned out a very important book on motivation and what we know is that people
are motivated by security. They want to feel safe. They want to be motivated by bonding. They want to be motivated by recognition of their peers. And, they want to find meaning in their work; if they’re going to work 60-70 hours per week, there has got to be something to it. You only live once and you need to do something you love. So really it gets down to, what is the meaning of work? What is the mission of your organization? What do you find exciting about it?” George then outlined the new definition of the real leaders. According to George, 21st century leaders: » Align. Leaders need to align their people to the rules to follow. They need to set out what the core mission is and how, when things get tough, they can help their people keep that higher vision in mind. » Empower. As a leader, the job is not to assert power over people but to empower people to step up and lead. The question becomes, “How do we get organizations where the people doing the work are leaders?” Empowered leaders at all levels create successful organizations. » Serve. Leadership is about service. “People are not there to serve you. No matter what business you are in, you are there to serve the people who work for you. You are there to make their lives easier, not harder.” » Collaborate. “Solutions to the many challenges we face can be found through collaborating within and outside your organization.” Even if it means collaborating with your competitors if the end-result is to create a better marketplace. So how does one become this type of leader? George asserted, “It starts with knowing what your most deeply held beliefs, values, and principles are. What do you really believe about people? What has motivated you? What is your true north—the internal compass that guides you through all your decisions? For if you don’t know what holds true, you can too easily be pulled off course. Too easily bow to the pressures, the short-term outcomes, or get seduced to leave an organization you love and go to one you hate, thinking you can make a lot of money without realizing what you are getting into.” George outlined five steps to achieving authentic leadership. Be self-aware, practice your values every day, balance your intrinsic and extrinsic motivators, develop support teams and good mentorships, and be the same person at work, at home, and in your personal life. “You have to feel good about where you work. You have to walk in and say thank you for what you did. People know when you feel gratitude for them. Not just the managers and the directors, everybody in the company. You can’t do that until you understand what motivates your people. At the end of the day, that is what is important.”
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“When you’re 97 years old,” George concludes, “And your family is gathered around, and your favorite granddaughter looks up at you and says, “What did you do to make a difference in the world?” The legacy you are leaving behind is by being true to your word. You can tell your kids all the rules of life but what they do is observe your behavior. They learn by watching how you treat other people. We don’t have to change the whole world; we can change our own environment, right here in our own companies, our own organizations, our own families, and our own community organizations.”
THE POWER OF THREE
Scott O’Neil, President Madison Square Garden Sports A former senior vice president of the National Basketball Association, and now the president of Madison Square Garden Sports, Scot O’Neil he has attracted premier talent from around the sports world to establish an innovative, passionate, resultsoriented culture. “This power of three or rule of three is something that can enable us to be leaders in our slice of the pie and change entire organizations,” said O’Neil. SCOTT O’NEIL
O’Neil looked back on his career path to date to reflect on the lessons he learned from his failures and successes. “I crashed and burned,” after the failure of the internet company he had been running went under, explained O’Neil, “Then I took a job for the commissioner of the NBA, Dave Stern. I wanted to work and learn. So that is what I did until six years later, I got the opportunity of a promotion to leadership position. Having worked for some real tough examples in business, I always thought, ‘If I am ever in a position to make a difference, I am going to build a world-class team!” As O’Neil explained later on, “for I knew that to build a brand, you need to start with building your team.” O’Neil then talked about the three rules he first used in the NBA and then applied toward his vision of turning around Madison Square Garden. Three rules, nonnegotiable, that he continues to lead by: » Root for each other. “Rooting for each other is not soft, it just feels soft. It does mean I love you; you love me as a person. It does mean ‘cheer for me and I am going to cheer for you. It also gives me a license that I would not otherwise have; license to challenge what you say, what you do, because you know I am rooting for you.” » Share everything. Share credit, share information. “Share bad news—the sooner the better, so we can deal with it.” » Be the best. “Decide every single day on every project and every interaction, every email, every phone call, every presentation and every PowerPoint that you are going to be the best in the world at what you do. Make that decision, we are not going to coast, we are going to be the best in the world.” As he stated later on, “There are no bad people; there are just people who are not committed to being great.” O’Neil outlined leaders of world-class teams let team members know that it’s okay to: think big picture, challenge the status quo, initiate, set best practices, innovate, be remarkable, lead, disagree, ask ‘Why not?’, set a new precedent, enable your team. “I’m good at two things: Hiring people and making them happy. Working at Madison Square Garden, I brought in a whole new world-class of people and did little things. New photos on the walls, new cubes, new conference room, so people would feel their own space. I had a six-month check-in with every employee.”
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“Now, you walk into the office and people are recognizing each other. We have gone to great lengths to send the message that we work together, we are a family. We celebrate a lot. And we have had terrific results. We are number one in everything we do. We have done world-class deals in the past two years; three deals among the top five deals ever done in the business.” O’Neil ended by encouraging people to always keep the big picture in mind. “Two years ago on vacation, with my three kids hanging all over me, I see this sign. I realize it’s perfect; it’s about family, life, being together and it’s about work, the sign read, ‘Keep the main thing, the main thing.’”
OLYMPIC PRESENTATION
Steve Mesler, Gold Medalist, U.S Four-Man Bobsled Team Since 2000, O.C. Tanner has proudly created and donated rings to members of the U.S. Olympic and Paralympic teams. In 2010, we extended our appreciation to include those who inspired these athletes to greatness, with the O.C. Tanner Inspiration Award. After receiving 48 nominations from Olympic and Paralympic Team USA athletes—more than one million votes were cast to select the individuals who supported, encouraged, and believed. STEVE MESLER
At this year’s Executive Recognition Summit, Steve Mesler, a member of the gold-medal winning four-man bobsledding team spoke. Sharing his gold medal with the crowd, the first for the U.S. in the sport for 62 years, this Buffalo, New York native talked about the joy of being able to bring his medal to pass amongst the crowd. “Getting the medal was everything I always thought it would be. Standing up on the podium, hearing the national anthem going, and having this chunk of gold around my neck was unbelievable,” said Mesler. “But what I didn’t understand was that every day afterwards was like Christmas as an adult. Getting to share this and bring it around to let other people experience this feeling.” His message, recognition is best when shared. PANEL DISCUSSION: FACILITATED BY ADRIAN GOSTICK, BESTSELLING AUTHOR OF THE ORANGE REVOLUTION
Ralph Polumbo, Albany International
RALPH POLUMBO
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“Albany International is a company that has been around since 1900. It has about 5,000 employees, more than half who work outside the U.S. The company was heading toward extinction when I joined in 2006, and in fact had eliminated its HR function entirely around 2002. I was hired to help with a transformation strategy but I knew we could only do it if the hearts and minds of the employees in this organization came along with us. What we had to prove to the top executive team was that if we failed to execute the HR strategy, of which recognition was a large part, we would fail to execute our financial strategy. We
now have a recognition gateway focused on living our values, extraordinary service, and milestone recognition. Well on the road to recovery, we have the highest margins of all time, the highest productivity of all time, and have turned around our engagement scores. If you have a strong recognition process in place, that is going to be the tool and the part of the HR strategy that is going to be put in play when inevitably you go through that next period of invention.”
Jacinta Nelson, Norton Healthcare
J A C I N TA N E L S O N
“Norton HealthCare is a five-hospital system in Louisville, Kentucky. We’re integrated with physician offices, urgent care centers, and have a broad base of health services that we provide. We are truly trying to bring recognition to everything we do. We brought in O.C. Tanner for training and did some role modeling so people could understand why we are giving awards and how it relates back to the values of the organization…We also have some company expectations, asking our employees, “Did we keep our promise? Are you being treated the way we said you would be treated?” We want the employees to know it is a two-way street, we chose you and you chose us. We put the touch point with the manager at 30, 60, 90 days. We tell people when they come into Norton Healthcare, there are only two jobs at Norton Healthcare-those who provide care to the patient and those who support those who do.”
Mike Ferone, Bank of America
MIKE FERONE
“We have 300,000 employees in 45 countries, six territories, serving 57 million customers. There are 45,000 associates outside the U.S., the remaining are in the U.S. boundaries. We are a very diverse company and trying to create a recognition culture and a recognition program that works for the entire company is very challenging. We did a rebid for the anniversary program in 2007; O.C. Tanner won that business. Later that year, we decided to rebuild the overall recognition platform… To date, we have had over 480,000 recognition cards sent, peer-to-peer cards and well north of 100,000 awards, so it has quickly been adopted.”
Lina Zvonar, Bank of America
L I N A Z VO N A R
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“If you are going to the leaders of your program and asking to spend money, they are very likely going to ask how are you going to prove the return on that investment. Design the high-level concept on the program, get the approval, select a partner who is going to work with you, for us, it was O.C. Tanner. Determine what you are going to spend company-wide and then the harder part of the question is how are you going to fund it? So for us, it was incremental spend year after year. We had to figure out what was going down each year to finance this. We had to come up with who is eligible. Funding, as we have regulators, want to know how we are spending the money. We are tracking associate rates, feedback, etc. If there is really a return on productivity, you want to tie it to performance. Our survey showed the response [to the question] ‘Being recognized motivates me to improve my performance’ at 97%, which is huge.”
LAUNCHING THE ORANGE REVOLUTION
Chester Elton and Adrian Gostick, bestselling authors of The Carrot Principle Known as the “apostle of appreciation,” Chester Elton, partnered with Adrian Gostick on another New York Times bestseller, The Orange Revolution. Their books have been translated into twenty languages and have sold more than a million copies.
C H E S T E R E LT O N
ADRIAN GOSTICK
“What was particularly gratifying for us,” Elton opened with, “was to experience what we knew to be intrinsically true, that our mothers and fathers told us from the time we were 5-6 years old, that if you remember people and you remember to say, thank you, that it actually accelerates business and cultures. We have talked to a lot people from different industries, different companies and we have said, ‘So, what is holding you back from having that big lead that you want so much?’ and as they would list the talent, the expansion and so on, what we saw a lot that was coming up was leadership development, leadership talent was showing up again and again and we realized that very few companies were saying, ‘We are excellent.’ [Instead] within these teams, there were pockets of excellence. “We thought if we could start replicating and find out what some of those intrinsic characteristics would be, we could really help change the world or help our customers. So, we have come up with The Orange Revolution, which means, ‘to create a high-performance team that achieves world class results’.” The Orange Revolution was based on interviews from high-performing teams around the world at companies such as Apple, Pepsi Beverages Company, Zappos, Texas Roadhouse, Madison Square Garden, as well as the findings from a two-year study of 350,000 people worldwide. Gostick explained, “We found six characteristics of really great teams. Some of them are very quantitative, things like taking calculated risks and measuring results. Some of them are more qualitative. Great organizations tell stories. Everybody has acknowledgement and everybody has respect. In the great organizations, there was a lot of peer-to-peer recognition going on. Celebration through good times and bad.” “All the numbers bear it out.” Elton explained, “Great teams set forth a cause and have that goal of excellence every day. So ask yourselves, what is your Mother Teresa cause? Who is on your team? Who are you cheering for? Really think about your team, think about the people on your team that you can cheer for, and I bet you can list them right away. Who is your team not cheering for? Breakthrough teams change everything.“
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2010 CARROT CULTURE AWARD
Winner: Pepsi Beverages Company E VA N GE LIN E PLANTE, JO HN B ERI SFORD, A N D C A RYN STEI NERT O F P E P SI B EVERAGES CO MPA N Y ACCEPTI NG THE 201 0 CARROT C ULTURE AWARD
Every year we honor an outstanding company whose efforts in the field of employee recognition have set it apart in its industry and with its employees. Past winners have included Texas Roadhouse, Xcel Energy, Avis Budget Group, DHL, and Quest Diagnostics. The winner of this award is selected from more than 8,000 clients. A committee of O.C. Tanner vice presidents, recognition trainers, authors and researchers is assembled to evaluate possible winners. The selection is based on the strategic nature with which the winning company pursues its business goals through recognition; the energy and enthusiasm devoted to appreciation in the organization; the success of the programs among employees; the results generated. This year our winner has created a culture of appreciation for more than 70,000 employees in North America. Their appreciation strategy and recognition solutions have been embraced from the executive level down. Their committed vision has consistently been aligned with the company’s business objectives—and reinforced with training and support. And, they continually gather insights and employee feedback—helping them monitor impact and set new goals. John Berisford, Senior Vice President of Human Resources, accepted the award.
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“Ten years ago, we started on this journey to make appreciation and recognition more important and five years ago, we started working with O.C. Tanner to do something a little different. This moving from recognition to appreciation, making it a little more of who we are, the fabric of the place, kind of in the DNA. [Creating] that story was one of the coolest stories that I have ever been a part of; one of the most interesting things I have ever done as a HR leader. We had been doing programs and polishing those up and making those a little more field ready, a little more executable but did not really have the organizations attention on this until five years ago when we invited O.C. Tanner in and assembled our top 200 leaders in Austin, Texas in a leadership meeting. We brought Chester [Elton] in [to speak] and delivered a [message] about how
important this topic was and then asked those 200 leaders to open a box in the middle of the table and they found personalized note cards with their name on top and we asked them all in the next 30 minutes to write personal notes to people they should have recognized but did not. We mailed 2,000 of them out from Austin that day. In my first 15 years with Pepsi, I got five personal notes. In the last five years, I have gotten almost 400. Multiply that times almost 70,000 people, and you have got a little bit of a culture revolution here.” “To connect back, we’ve grown the stock 330% in a 10-year period when the DOW was fundamentally flat, and we think that is recognition and appreciation is one of the key drivers of that. Just this year, we sold the Pepsi Bottling Group back to PepsiCo in an $8.5 billion dollar transaction that will continue to create value for PepsiCo forever. We fundamentally believe that this work [that creating a culture of appreciation] is absolutely connected to creating shareholder value, delighting customers, satisfying consumers, and all of the things that are core to our mission statement.”
For more information on engaging your workforce and achieving key results by recognizing great work, visit www.octanner.com.
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O.C. Tanner is the world leader at helping companies grow by appreciating people who do great work. Because celebrating great work inspires people to invent, to create, to discover. And when people are inspired, companies grow. Our performance awards, service awards, web-based recognition tools, and other incentive programs turn corporate goals into reality for more than 8,000 wellknown customers worldwide. www.octanner.com
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Ed Bagley O.C. Tanner Company Director, Communications Toll Free: 800.828.8902 Phone: 801.493.3923
[email protected]
