Dick [00:00:01] Hiring practices: finding, hiring, and keeping good talent has everything to do with how engaged their employees are. It becomes an attraction magnet when employees are engaged in a company – they’ll tell their friends what a great place it is, how they’re recognized for their contributions. And so, as a consequence, they have a pipeline of new possible hires.
Don [00:00:23] My name is Don Rheem, CEO of E3 Solutions, and author of the book “Thrive By Design: The Neuroscience That Drives High-Performance Cultures.” I speak across North America on the neuroscience of engagement, and I’m passionate about helping leaders at every level create engaging workplace environments where employees feel safe, recognized, and validated. Employees who feel safe are happier, healthier, and more productive. Each week, my team and I take on topics impacting managers, and we offer solutions to your biggest workplace challenges. And you’re listening to Thrive By Design, a podcast created by E3 Solutions to give managers, CEOs, and leaders tips, strategies, and tools needed to create an engaged culture at work.
Don [00:01:14] Welcome, I’m your host Don Rheem, CEO of E3 Solutions. Over the past several weeks, we’ve launched a special guest series where we talk with subject matter experts one on one about critical workplace challenges. Our guest this week is Dick Smith. Dick leads several groups of CEOs who meet monthly to tackle tough business issues as a part of Vistage International, a membership organization for CEOs. In his role, he provides executive coaching to his Vistage-member CEOs. And he’s been doing that for over 10 years as a Vistage chair. Welcome, Dick, and thank you for taking the time to be here with us.
Dick [00:01:57] It’s my pleasure, Don. It’s great to be with you today.
Don [00:02:01] I know you’re a busy guy. I want our listeners to understand a little bit about what you do. You’re a Vistage chair. So, you’re a chair of some groups under this organization called Vistage. Can you tell us a little bit about what Vistage is, and what your role is as a chairperson of groups in Vistage?
Dick [00:02:18] Sure. Well, thanks for asking. Well, first of all, Vistage is the oldest and largest company dealing with CEO-level execs and their senior leadership team. We say that we’re around to help our leaders make better decisions, become better leaders, and get better results. We have 22,000 members worldwide in 16 countries. As you mentioned, I run as a facilitator and coach, three different Vistage groups, on average 13 to 15 members in each. And we meet once a month, for a full day, twelve times a year, and we sit around and help one another identify challenges, decisions, opportunities that they have. So, we help one another decide how to better run our businesses a little bit better in this peer advisory concept that we have.
Don [00:03:10] So, Dick, recently I spoke to your three groups, and I was talking about employee engagement. And, first of all, I’m always impressed when a Vistage chair believes that employee engagement is an important topic for their members. Help me understand where employee engagement fits in for your members, again CEOs of their own companies. Why this issue so important?
Dick [00:03:32] Well, in my candid opinion – it’s one man’s opinion – but I think shared now by many.
We know that when our employees are engaged at a high level, they perform at probably two to three times the employee that’s not engaged, if you will, to any degree. And so, that means we can do things better, doing them faster, doing them cheaper.
And that’s always a goal for our members. And I feel that employee engagement covers so many things across the board as it relates to performance. It’s in everything that we deal with from an issue standpoint month by month.
Don [00:04:06] So, when I was there and talking to your groups on these three consecutive days, I did talk a lot about neuroscience and the science behind what drives people when they’re at work, what drives their behavior. How did that land on people in, you know, reflecting on it afterward? What kinds of things did you hear, how were members reacting to this science-based approach?
Dick [00:04:23] Well, great question, and going back to – I actually heard you speak, Don, back in 2011. I had you speak to my Vistage groups back then, and I was very impressed back then with the neuroscience of employee engagement and your assessment tools. And then, I think it was August or September 2017 when I read under our Vistage chair network that you came out with a book called “Thrive by Design.” I immediately bought the book, read it, and said, “Oh my gosh, this is exactly what my members need.” I went ahead and bought 50 copies for their holiday present and gave it to them Christmas time in 2017, and proceed to tell them that we’re going to go through this book every quarter. We are going to read four chapters and then review, and see what it means, how it resonates with you folks.
Dick [00:05:14] They actually fell in love with the process, learned a lot in reading the books, and as you know, I brought you back in February this year, to really reconfirm, not only with my members, but they invited some of their senior-level staff. And I got to tell you that I was a member myself for 13 years, chairing now for over 10 years, and out of all the speakers I’ve ever heard, I think your program won, is the most impactful, and you are probably, if not the highest-rated speaker I’ve ever had in front of my group, you’re right near the top. So, what they took away from it, many many things.
Dick [00:05:51] Things that they’re still using today. I met with a member today and asked that question at breakfast this morning. I said, “Help me out, what did you take away from Don Rheem’s presentation?” And, basically a couple of comments: One, you’ve got to do this – every time there’s a bad thing that happens with an employee, it takes five to correct that, so they’re trying to do more of that recognition five to one. They’re also talking about making sure that the employee feels safe, and making sure they understand what’s next in a lot of our conversations. You’d be amazed how often this comes up in my coaching sessions with members. When we talk about: Well, are you making that employee feel safe? Are you making that employee feel that they’re making a great contribution to the tribe, as you say? And, well anyway, so you know many, many members are using it. In fact, as you know, you’re coming back to Chicago. We talked about it back in February. You’re coming back to do two eight-hour workshops on May 29 and 30 here in Chicago. And many of my members have signed up to go back themselves, as well as bringing quite a number of their leadership team members to your workshop.
Don [00:07:00] Yeah. And I’m looking forward to those two sessions, and it’s great to see that very high level of interest that was there. And you mentioned this issue of the importance of people feeling safe, and I do talk about it in the book, but for listeners that may not have read the book – the issue here is around the limbic system in the brain and the role of the limbic system in threat detection. And if employees don’t feel safe when they’re at work, and by safe, work is unpredictable, inconsistent, and not fair. They have a manager who’s not available, inaccessible, or is mercurial in how they treat and respect employees. The brain starts hijacking resources with the limbic system, starts hijacking resources from other parts of the brain, to deal with that perceived threat. And what that means in very practical terms is an employee’s IQ drops, their peripheral vision collapses, their ability to care and know what’s going on for other people around them goes in decline. Now, Dick, as a chair, part of the Vistage process is you sit down with these 13, 15 CEOs around a table, and you process issues. And a member brings up an issue they’re dealing with, then all the other CEOs come around, and support that member, and they work through the issue and try to create resolution. In all of these issues that you deal with, and you touched on this a little earlier in a comment, but where does employee engagement fit in that hierarchy of issues? Or, maybe another way to ask it is: For those issues that you deal with, how many of them really pivot around employees’ commitment and presence when they’re at work now?
Dick [00:08:31] Great question. And I have the saying that goes: For every CEO, 80 percent of their problems walk through the employee entrance every day. So, almost every single issue we process has to do with employees in one way, shape, or form.
Dick [00:08:50] We talk about compensation – certainly there is an area there that obviously you have to reward employees to make them not only feel safe, but provide growth – what’s next for them. Benefits, culture obviously has to do with employee engagement. Hiring practices: finding, hiring, and keeping good talent has everything to do with how engaged their employees are. It becomes an attraction magnet when employees are engaged in a company – they’ll tell their friends what a great place it is, how they’re recognized for their contributions. And so, as a consequence, they have a pipeline of new possible hires.
Dick [00:09:28] So, as I say, 80 percent of your problems, if you’re a CEO, walk through the employee door every day, so engagement is overarching into all those issues.
Don [00:09:40] Dick, how important is the current labor shortage playing? We see results have been coming out every month. Last month, an additional 263,000 jobs were added to the U.S. economy. The unemployment rate is down to 3.6 percent. How big is this talent crisis because you mentioned a magnet for new employees? How critical is this talent crisis, and what do you see as the role of employee engagement in both retaining current employees, but then attracting new ones?
Dick [00:10:09] Yeah, well, I don’t know if you actually came up with this phrase or someone else, but it’s no longer a war on talent, it’s talent Armageddon out there. You know, the people who are unemployed are those who probably need to be unemployed, unless you get really lucky and find someone in a transition. You don’t really want the people who are unemployed. You need to steal people from other entities, whether they’re within your industry or not, because you become an attraction because of the way you’re treating employees, and getting them engaged at various levels, appreciating them. You know, the approval of their efforts and putting career ladders together, you definitely are going to be the talk of the town. There are yelps, employees coming and going, on how well this company treats them. And how they’re a good member of a great tribe, versus the opposite, which is going to detract people from joining you. And you touched on it quite a lot in the book – it’s got very little to do really, I find, with the money, that is, at least, you have to pay.
You want good people, you’ve got to pay better than the average wage, but beyond that, you keep them, as you call it “emotional velcro,” by dealing with – making sure they feel safe, and they’re contributing, and get recognized for it.
Don [00:11:28] Yeah. I was with a construction company recently on the West Coast, and they talk about how employees will walk across the street for 25 cents an hour more, and how do they prevent that from happening? And I always explain the only way to prevent that from happening is if employees do have this “emotional velcro” – these hooks and loops that hold an employee to an organization, and that’s essentially the felt experience. And in that TEDx talk I did, I used this line I’ve heard repeated back to me a lot: “The future of work will be defined more by how it feels than how it pays.” And we’re talking about this felt experience people have at work. And what I know from the neuroscience is that the way people feel determines how they behave. And ten years ago the science, I would have said the way people think determines how they behave, but now we know it’s really how they feel. And so, when we talk to clients now, Dick, we’re talking to them, it’s not about their hiring strategy so much now as it is about their retention strategy. And this issue of employee engagement is about that. How to create, help create these hooks and loops that hold onto people, and help them tell great stories about where they work to attract other talent.
Dick [00:12:39] Yeah. I certainly can relate to that statement. I’ll even take it another step: It’s, you know when you talk about it neuroscience, all of us, myself included, want to be appreciated for our contributions.
Don [00:12:52] Right.
Dick [00:12:52] And when we are, we will go the extra mile. I have 45 members, and there is a bell curve from time to time – my impact. And when they tell me they appreciate, like Kristen did this morning, in the coaching session that we had, because I challenged her ideas, and made me feel approved, appreciated. I felt safe with her continuing as a member of my group. And what’s next is we’ll keep doing this because she likes it. Well, I’m going to go to bat for her. I’m going to probably even do more for her than someone who is a know-it-all, just dismisses me and suggests they don’t need me. So, it’s all reptilian brain neuroscience, in my opinion, every day, with every person we come in contact with, not just our employees.
Don [00:13:42] So, what we found, and what I think I have found, Dick (and I’m curious about your opinion) is when I do these sessions with managers and companies around employee engagement and I talk about the neuroscience of what drives behavior, they often tell me afterward that that was the distinguishing characteristic of our content – is it was science based, and that was very important to them. And they talk about how there have been so many leadership fads that have come forward over the last 30 years, that they really believed in this approach more because they saw the clarity of the science behind it. What have you found with your members, because this science and especially neuroscience, around behavior – is it resonating with them and why do you think?
Dick [00:14:23] Well, the simple answer is yes, it’s resonating, but, there’s a saying that I use: “You can’t teach a kid how to ride a bike at a workshop.” That’s part of our problem. We hear great speakers like yourself, we’ve read books, and we start practicing things. And, at first, we’re clumsy. So, it’s the conscious competency model. We need to do this. We need to give them five ata-boys/ata-girls for one negative comment.
Dick [00:14:56] So, we have to keep this in mind. It’s a simple straightforward model and process, and I love your evaluation tool as well, but it’s difficult to get people to change their behaviors. Leaders, and managers, I’m talking about, who have been in place for 20, some 25 odd years in some cases, or 10 or 15 with a new manager even. So, it’s a matter of keeping it in front of them, keeping them conscious of it constantly. You know, Patrick Lencioni says you need to tell people seven to 11 times before it sinks in. Well, that’s very true. I mean, they walk away from a workshop, maybe retain 20 percent of what you said, and if they review it in 48 hours, which we ask them to do, including a recording, maybe it gets up to 30 or 40 percent, but then it slips away if they just go back and they’re on autopilot at their offices.
Dick [00:15:48] So, that’s why your tool is so cool if you ask me. The measurement of success and the constant reinforcement, we got to practice this. It’s like playing the piano – I’ll give you all the music theory all day long. I was in a band years ago, made a living playing in a band. We can talk music theory all day long, me teaching notes and all that stuff at a workshop, but until you start playing, you’re going to sound like crap the first time around. But, down the road a few months from now, you may even sound good enough people will be willing to listen to you, let alone pay you for listening.
Don [00:16:21] So, Dick, you’ve mentioned our evaluation tool, and for our podcast listeners that don’t know that part of E3 Solutions, we do have a 28-question online survey that employees in our client companies take. And it gives us a profile for engagement, levels of engagement within the company. And we also then aggregate that data by manager, so every manager we have has a really clear sense of how many of their employees are either actively engaged, engaged, somewhat disengaged, or actively disengaged. And then we follow that up. And Dick, your point about practicing this is a key reason why we developed the ManagerResourceCenter.com, which is a website that’s free to our member clients. And to keep this message going every Tuesday, we send every one of our managers that are in our client companies an email we call “Take 10 Tuesday,” and we ask them to take 10 minutes to invest in their skills as a leader. And we guide them into the website on either a video, an article, a self-help assessment that they can take because we really need this steady drip of reminding managers you’re not just there to manage things, you need to lead. And one of the key aspects of leadership, and where they need to leap today in this labor environment certainly is around engagement and creating that “emotional velcro” with employees. Dick, I want to ask you, any last thoughts or comments about the importance of employee engagement to leave our listeners with as someone who is leading, coaching, and mentoring CEOs in the Chicago area?
Well, I just think if there’s anything leaders in organizations could work on for the most significant impact both short and long term, it has to be getting their employees to get better engaged, and it really is, as you pointed out, it’s the manager’s role.
People, I think you say it, they don’t quit companies, they quit managers. And as you demonstrate both in the book, I think, and your workshop, that you can have the same company, same culture, same values then a manager who’s got totally engaged employees in one department and another manager with the same culture, values, everything else, mission who has disengaged employees. So, it really is the manager, I think, who needs to practice this stuff, and I love the tools. Like I said, I can’t think of anything that makes a bigger impact.
Don [00:18:45] Thank you, Dick, and by the way, I did not say talent Armageddon. That was not my phrase, but I’m going to claim it going forward in my workshops. I love that. It’s not just a talent crisis or talent war, it’s a talent Armageddon. And managers, for the first time in managers’ lives, Dick, the manager now has to know how to create the conditions where employees look forward to coming to work, and that’s new for most managers. And I believe having a deeper understanding of how to engage those employees and create that “emotional velcro” is going to be one of the best ways to do that – to create these conditions where people look forward to coming to work. And Dick, I want to thank you for taking the time to be here. This has been great. Thank you so much.
Dick [00:19:26] My pleasure. Good luck, Don.
Don [00:19:27] Thanks, Dick. That’s it for today. I’m your host Don Rheem, and thank you for listening.
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