Do companies see employees as a Value? Asset? Investment?

*Given that you hire a person that adds value immediately through personality, perspective, behavior, professionalism, intuitiveness, integrity, etc...

Restaurant Theorem 1.1

Does the Employee have Value?
1.1.1 A new employee starts with a competency of 0, but by day 5 they fit in, are responsible, learned policies and procedures. Due to increased knowledge and experience they are productive and therefore have value.

Is an Employee an Asset?
1.1.2 Because of 1.1.1, employees have value. If you lose an employee there is a cost to replace them. If there is a cost to replace them, employees are an asset.

Is the Employee an Investment?
1.1.3 Because and employee has value (1.1.1) and they are an asset (1.1.2), can they also increase in value. If that employee who worked 5 days quits, you lost 1 vested week in that person. You have to start over by hiring new employee and their value starts at 0, the person who worked 5 days has a higher value than the new employee. Because an employee’s value can increase over time, it makes them an investment!

If you had an A player that has worked for you for 1 year! Look at the investment you have in them. If they told you they were going to quit and now you had to replace them with a new hire, that new hire does not have the same level of knowledge and experience. How will that difference in the new employee affect their co-workers, guests, manager and company?

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Comment by Galen Istre on June 25, 2008 at 10:32pm: What a great topic. Companies that really see the big picture understand that the employees are the very basis of their success or failure. Losing a crew member after 6 months would cost me over $6500.

I believe that every person on our payroll is an asset. With every passing week, month and year the knowledge these crew members and managers have is priceless. Creating a nurturing environment where ongoing training & development occurs daily constantly raises the bar and acutually promotes from within on all levels.

Raising Cane's is a cultural based company that embraces these philosophies. The crew that buy into it take ownership and become successful.

The worst customer experience you can have at a restaurant is where the crew is untrained and the manager has no clue.

Comment by David Turk on April 17, 2008 at 12:16pm: I'm with all of you. A people-centered culture is key to our ongoing success....period. Focussing our efforts on maintaining a positive work environment is critical to our longevity.

I discovered recently that the cost of replacing an hourly employee in our industry, after everything is factored in (advertising, interviewing, training, mistakes, clerical, etc) is in the vicinity of $5000; and that average turnover is 100%. Therefore, for every 10 employees, it is costing us about $50,000/year to employ/replace them.

We need to do something immediately, in general, to stem this tide. And the responsibility lies with us.

To that end, I've created my Five Golden Rules for Healthy Employer-Employee Relationships:

In all interactions with our employees, we must

1) Maintain or Enhance Their Self Esteem
2) Learn how to Give Trust......without Strings Attached
3) Hold Them to High Standards
4) Ask for Their Help
5) Thank Them, Thank Them, Thank Them......genuinely

I will explain each of these more thoroughly in the days ahead.

Comment by Andy Swingley on April 17, 2008 at 7:03am: I am with Michael, you have to get this up for everyone to see. It is an important way to measure the value of our employees. This issue solved protects all of us from swings in the economy - it is proven that if our teams execute well with a good product, people will come to you.

I know I go back to the places where the employees are efficient. Just last week while I was picking up a Starbucks, I said to my wife....."Those employees are so engaged, I would like to work in the environment" I go back there because of it.

Value the employee and the business grows.....

Comment by Michael L. Atkinson on March 16, 2008 at 2:51pm: Nice post. I would love to feature this on Main, but you are not permitting that. Thanks for appreciating the employee. Starbucks always put the employee ahead of their customer...seems t work for them.