In July of 2007 we conducted a Management Survey among the more than 2,000 subscribers to our newsletter. They were asked to share their data, business practices and experiences with us. One of the questions asked participants to rate 10 topics in order of MOST to LEAST challenging issues in their business.

It won’t come as a surprise to anyone reading this that client-related issues were the least challenging, with RETAINING CLIENTS AND CLIENT TURNOVER coming in at number 10.

Conversely, RETAINING EMPLOYEES AND EMPLOYEE TURNOVER ranked the second biggest challenge with RECRUITING GOOD EMPLOYEES / HIRING THE WRONG PEOPLE being reported as the number one major challenge they face as business owners.

The next three biggest management challenges ranking from # 3 to # 5 were:

QUALITY CONTROL ISSUES / POOR WORK HABITS / FAILURE TO FOLLOW CLEANING METHODS

COMPENSATING EMPLOYEES / CONTROLLING PAYROLL COSTS

EMPLOYEE BEHAVIORAL PROBLEMS / POOR ATTITUDE

The fact is that most employee-related challenges can be reduced by at least half before they’re even hired by using a quantifiable selection process in our recruiting efforts. There is a tendency in the industry to hire anyone who can steam up a mirror when she breathes on it. This fact was borne out in our survey, which revealed the following . . .

. . . . . NO qualifying process whatsoever!

If we don’t make every effort to qualify job applicants right up front, we’re asking for nothing but trouble down the road. If we hire the wrong people for the job, even the best people-managers in the world are going to be behind the 8 ball sooner or later.

Recognizing that most entrepreneurs in EVERY business have no formal training in hiring employees, back in 1995 we invested $25,000 developing a quantifiable 5-step selection process with Dr. David L. Stum, PhD, a well-known human resource expert who has consulted with dozens of Fortune 500 companies on this very subject. Those of you in the audience who have our House Cleaning Biz 101 program are fully aware of this process.

The fact is that mistakes will always be made by even the most fastidious and proficient owners when it comes to hiring people in your workforce. However, even if you’re 100% right in every recruiting decision, this alone will not prevent employee turnover, eliminate quality control issues, or stem poor work habits, behavioral problems or bad attitude towards the job ― all of which the survey revealed were among the top challenges facing owners, even those in business for more than a decade and doing over $1 million in annual sales.

Some of the things which can create challenges among even the best employees include:

 Improper or insufficient initial orientation when the employee starts the job; employees are often “shoved into the breach” on day one. On-the-job training is important, but if that’s all it took to become a doctor, attorney, scientist or any other profession, there would be no colleges or formal education centers. Orientation is what prepares your new hire for her internship in the field.

 Failure to set forth company policies from the outset of employment with a written company policy handbook which clearly spells out the terms of the relationship on what employees can expect and what is expected of them.

 Inadequate or non-existent formal training program, which leads to inconsistent results, client dissatisfaction and employee frustration. Furthermore, training is NOT a one-time event; it needs to be an ongoing activity for as long as the person remains in your employment.

 Insufficient income. While surveys have proven that money is usually not the primary factor in job satisfaction, an income inadequate to meet an employee’s financial needs is a de-motivator and will produce dissatisfaction and high turnover. Owners tend to be more sensitive about keeping clients with low prices than they are about charging enough to attract and retain good employees by ensuring their wages are where they need to be to attract and retain them. Successful owners in this industry tend to make sure their good employees can earn $12 to $15 per hour (regardless of what compensation system they use).

 Contagious Unrest. One bad apple in the barrel can destroy the good apples – along with the barrel itself. One bad employee can not only turn good apples into rotten ones, she can have devastating impact on your entire company. When disgruntled employees are not dealt with accordingly, good employees either follow suit or simply leave the company. All too often managers tend to look the other way instead of purging the problem because the guilty party is technically proficient. BAD MOVE.

 Poor leadership. Very few owners in our industry had any formal management training or business experience prior to starting their cleaning businesses. When management shows indecisiveness, favoritism, lack of leadership, poor judgment, low tolerance levels or public outbursts of anger and frustration, it creates destabilizing atmosphere and is reflected in employees’ character and attitude toward both fellow coworkers and their clients. Perhaps the best book on Leadership I have ever read is titled, “The Leadership Secrets of Attila the Hun” by Wes Roberts, PhD. Don’t be fooled by the title! It’s available from Amazon. COM or your local book seller in paperback and I heartily recommend it as mandatory reading for anyone managing people.

These and other management topics are discussed in detail in our 11-hour House Cleaning Biz 101 seminar series on CD ROM. However, this article is going to address the topic that’s perhaps the most invaluable tool you can use in motivating, improving, managing and retaining good employees – as well as being an objective means of disciplining and removing the bad apples you’re bound to attract regardless of how well you screen prospects during the recruiting process.

Your Employee's Report Card:

The tool we’re talking about is a form of report card, not a lot unlike what your kids get in school. The difference is that in the workplace environment it’s called a Performance Review.

In the survey we conducted we found that 4 out of 10 owners NEVER conduct a performance review and 1 out of 10 of those who do conduct performance reviews only do so when they have to discipline an employee!

Conducting regular performance reviews is crucial element in your human resource management strategy. When well conducted, performance reviews will help increase tenure. How can performance reviews improve retention? A consistent finding in employee surveys has been that employees who are learning, growing, and feel that they are making a contribution stay on the same job longer. You have a chance to help associates learn, grow and become better contributors through performance counseling.

The Performance Review

Though reviews are sometimes feared and too often avoided, the fact of the matter is, they should be looked forward to as positive-relationship builders between you and your associates.

Human resource surveys over the years have shown clearly that employees are not very critical at all about how well such reviews may be conducted — but they are very critical if they are conducted infrequently, or not conducted at all.
The key to conducting a quality performance review is to think and plan the discussion before it happens. You may know in your head exactly what you want to say regarding an associate’s strengths and weaknesses, and therefore, decide you will just talk to them the next time they’re available — without any moments of thinking or outlining the session.

The typical mistake here is that though the evaluation is right, you need to think through how you will send performance messages so that the associate can learn and act upon them. If your messages don’t get thought through, or are not accepted, they don’t count, and you have not really conducted a review of performance.

The following general guidelines can be used as you outline your performance review discussion.

Evaluate the Performance Not The Person
It is important that you use phrases and an outline that shows your focus is on the job and the performance, not on the person. Think about the following phrases that could be overheard in a performance review session:

“YOU are doing a great job.”

“YOU haven’t learned the proper cleaning methods.”

Both phrases are harmful.

In 1. the associate may feel good momentarily, but doesn’t know specifically what you’re talking about. The associate cannot learn and act upon this information in order to maintain and improve performance.

In 2. the associate may feel bad momentarily, but also doesn’t know what you are talking about and cannot act upon such information. Each statement starts off in the wrong direction — YOU — and ends up nowhere.

The types of phrases that are overheard in effective performance reviews would sound something like the following:

“The job, as you know, requires quality. We have received great compliments and zero complaints from clients about you or the team. Clients have told me that you amaze them in how thorough you are with attention to details in the kitchen.”
“As you know, the job requires attention to the details in our cleaning procedures. Though we’ve covered details on the use of the apron in our training, I noticed you didn’t follow those procedures last Tuesday at the Smith house. We will repeat the procedures tomorrow morning. Your job requires that this is learned and I am willing to help.”

Those examples start with the focus on the job, then provide specifics about the person’s performance in relation to the job. This type of focus in your performance review meetings will help you send the message that associates can learn from and act upon.

You have two tools for keeping the focus on performance:

The Job Description

The Team Member (or Team Leader) Performance Review (or in the case of an employee in training, The Training Review Report).

The Job Description
To begin with, if you don’t have a clearly defined, written job description to go over with employees during their orientation period, along with a company policy handbook, there is no defined reference point to refer to when discussing performance issues with an employee. An employee must know EXACTLY what is expected of her and by spelling it out in writing it gives you a reference point to turn to during the performance review. SAMPLE OF JOB DESCRIPTION

When you conduct your Performance Review, always keep the job description on your desk and in view of you and the associate. This is a clear signal that the job is the reason for the meeting — not to deliver complaints or compliments. Refer to items in the description as appropriate to make comments about associate strengths or weaknesses in performance. It’s also a good idea to have a copy of your company’s policy handbook handy, especially if the review needs to address a specific issue related to a disciplinary matter.

The Performance Review Form

One of the often-overlooked elements of reviews is the importance of motivating and reinforcing the outstanding performer. These associates still need to be told “what” they are doing right and “why” it is important.

This is valuable reinforcement. As good performers, they also need to be challenged to maintain such high standards and even reach for higher goals. Good people like challenges. Do not lessen the time or emphasis and a chance to learn from and act upon your review. SAMPLE PERFORMANCE REVIEW

By going through each criteria from Knowledge to Attendance you are teaching the elements of performance once again and providing the employee with feedback about job performance. Your feedback message, whether the rating is a 0, 1, 2, or 3 should contain the following:

What the criteria (such as Initiative) means.

Why it is important to the position.

What you have observed about performance on this criteria.

What rating is assigned because of the performance.

What the employee can do to maintain (2 or 3) or improve (0 or 1) performance.

The Performance Review Form gives you the ability to rate each of the 8 Professional Criteria Categories accurately.  The required criteria for each category is defined, and what performance accrues a rating of BELOW JOB PERFORMANCE, ACHIEVED JOB PERFORMANCE, and what performance is considered EXCEEDING JOB REQUIREMENTS.

The employee will receive a rating of 0 – 3 for each of the 8 Professional Criteria. A perfect score would be 24.

Performance Improvement

When the performance rating is 0 or 1, you owe the associate a game plan for improvement. Certainly just saying — “you have to do better” — is not much guidance. Coaching someone so that they can do better requires that you help the associate set a performance improvement goal. One of the most successful techniques for setting performance improvement goals is the “SMART” model.

S = SPECIFIC
You need to be able to specify very clearly the goal for improvement. Instead of saying that — “attendance will improve” or “should volunteer more often” — you need to write with the associate a one-sentence behavior-based improvement statement. These types of statements sound like the following:

“Will be at the job every day for the next four weeks.”

“Will find an opportunity to volunteer once a week for the next four weeks.

M = MEASURABLE
The goal set must be stated in such a way that a measurement can be made. Was the goal met or not met? How will you know? How will the employee know?
As the old saying goes, “if you can’t measure it, you can’t manage it.”


A = ATTAINABLE
Be sure that the goal can be attained in the time period set and that any support required from you, the Team Leader, or team members, will be available. Make sure the goal can be attained in the current work situation and is within reach when considering all job factors.


R = REALISTIC
Poor performers cannot become outstanding performers just through goal setting. The task is to make them “better” performers, one stage at a time. Set goals which are a realistic stretch from current performance, but don’t set up the associate for failure.


T = TIME BOUND
In order to be effective, the goal must include a specific time when you will check up to gauge progress toward the goal that has been set. This is important so that you will both know if progress is or is not being made. There should also be an end time when you will evaluate together to determine if the goal has been reached.

When Should Performance Reviews Be Conducted?

Actually, almost immediately after the employee commences training. However, the format of the Training Performance Review needs to be modified to address whatever portion of training has been completed.

Here’s an example of a Training Review Report that covers 9 specific areas, including “Behavioral Habits” – an important element in job success. Training Review Report

By starting early in the game, employees will become accustomed to job performance reviews and, properly conducted and with the right coaching, they’ll look forward to them.

When Disciplinary Action Is Needed…

….rather than conducting a full-blown Performance Review, you should have interim formal documentation to use in these instances. A Record of Verbal Warning, for example, to address a recurring tardiness issue is a good choice. This document should be completed by you or the person’s immediate supervisor or team leader and put in the employee’s file.

RECORD OF VERBAL WARNING

When the activity is repeated, or a serious offense occurs, use a Notice of Employee Deficiency form, in which case the employee is required to sign the form thereby documenting that the issue has been discussed.

NOTICE OF EMPLOYEE DEFICIENCY

These, and not Performance Reviews, should be used when disciplinary action is required. By doing so, the Performance Review process will not be viewed as something to fear (even though Performance Reviews may well address these past issues in review).

Exit Interviews


You can accomplish many things by conducting an “Exit Interview” with departing employees. The Exit Interview is another key milestone on understanding employee retention.

The focus on this discussion should not be just on the employee’s leaving and the reasons why. This is also your chance to hear their perspective in all of the previous elements of your Human Resource System. Exit Interview Form

This is a good time for both of you to reflect upon and learn what happened regarding such experiences as:

The original reason the employee wanted the job and thought it was a good match.

The phone and personal interview experience.

The orientation and training provided.

The pay and recognition received.

The job requirements and the behavioral style fit.

The performance reviews held.

In each discussion area, you will hear how the employee viewed the event, and whether you could have made changes that would have increased the length of stay on the job. Remember that an employee’s leaving is not a disgrace for you or for them. It is unfortunate, however, if you cannot use this time as a learning moment for both of you.

Good employees will leave. People grow and change and move on. This is a cause for good feelings on both sides. Sometimes things don’t work out and you terminate an employee or the employee quits for negative reasons. This is also normal, and provides an opportunity for growth and learning in understanding what happened.
There is a true story about one manager who had a great reputation regarding exit interviews and terminations. This manager was praised by all previous employees, even the ones who were fired! Upon investigation, past employees described the manager in the following ways:

“He was straight with you. He told you what the job was going to be, what you had to do, and what he was going to do. And that’s exactly the way it was.”

“He took time to tell you what you were doing right and not doing right. I don’t know if he liked me, but I know that he respected me and all the other employees.”

“He was predictable. You know, consistent. It wasn’t hard to figure out what he wanted and how he was going to react.”

“He had a way of talking about the job that made you end up feeling good about yourself. I don’t know how he did that.”

“I hated to leave my job, but I needed to move on to something else. I will always remember the things he taught me.”

“He fired me and he took the time to explain it. I know he was right to do it even if I didn’t like it.”

Those types of comments took place not only because the manager was a special kind of person, but because he followed consistently a system of human resource management techniques and procedures.

From the Phone Interview to the Exit Interview, you will either have provided the structure and the system that works or doesn’t work. If you put the quality in the system, one of the end results will be employee