The Wall Street Journal’s January 10, 2002 article “Hidden Cost of Labor Strife” describes how incorrectly reducing labor costs results in higher operating costs.

A Fortune magazine article cites examples of correctly reducing costs in difficult times and have employees support your decisions, be sympathetic and helpful.

At Emerson Electric Co., we never had employees be sympathetic and helpful when we sought wage cuts, job rule changes or downsizing.  However we never encountered labor strife and rarely a strike.  Although Chuck Knight was an angry, confrontational CEO with his officers, he was very reasonable and fair with lower level salaried and hourly employees.

As a result, we never offered harsh and unreasonable terms in any negotiation.  We were trained to manage with a union including candid, frequent communication.  We stopped trying to decertify unions essentially because of the poor return on investment.  If the union chose to strike, we had built a strike hedge and organized non-union employees to staff the plant.  We never lost a strike.

The Wall Street Journal article is based on the findings of two Princeton University professors. Firestone Tire offered harsh, one-sided rule changes, wage cuts with new 12-hour shifts in an effort to reduce its Decatur, IL costs.  They defeated the strike.  Workers were forced to return to work and accept the new terms.  As a result, this plant produced the bulk of the defective tires that resulted in 40 deaths.

The Fortune article cites the reasons companies are rated “Best to Work For”:

(1) Employees are treated with dignity and respect.

(2) The CEO is personable and uses “random walk” to talk to employees informally.  Employees said they want to see the CEO, touch him and talk to him.

(3) Knowing what is going on in the company and how it is doing.  The reasons for decisions.  Communicating the why for a downsizing and the alternatives.

(4) In bad times management and employees are treated the same.

(5) All of which leads to “trust” of management, an important factor.

(6) Money or salary was not a prime factor.

Interestingly terminated employees in a downsizing within these Best to Work for Companies were often understanding and productive while working their last day on the job.

Not surprisingly companies considered by employees to be the “Best To Work For” companies tend to be best performers.

See Fortune’s February 4, 2002 magazine article “100 Best Companies to Work For”.

The The Wall Street Journal’s January 10, 2002 article “Hidden Cost of Labor Strife” describes how incorrectly reducing labor costs results in higher operating costs.

A Fortune magazine article cites examples of correctly reducing costs in difficult times and have employees support your decisions, be sympathetic and helpful.

At Emerson Electric, we never had employees be sympathetic and helpful when we sought wage cuts, job rule changes or downsizing.  However we never encountered labor strife and rarely a strike.  Chuck Knight was an angry, confrontational CEO with his officers.  But he was very reasonable and fair with lower level salaried and hourly employees.

As a result, we never offered harsh and unreasonable terms in any negotiation.  We were trained to manage with a union including candid, frequent communication.  We stopped trying to decertify unions essentially because of the poor return on investment.  If the union chose to strike, we had built a strike hedge and organized non-union employees to staff the plant.  We never lost a strike.

The Wall Street Journal article is based on the findings of two Princeton University professors. Firestone Tire offered harsh, one-sided rule changes, wage cuts with new 12-hour shifts in an effort to reduce its Decatur, IL costs.  They defeated the strike.  Workers were forced to return to work and accept the new terms.  As a result, this plant produced the bulk of the defective tires that resulted in 40 deaths.

The Fortune article cites the reasons companies are rated “Best to Work For”: (1) Employees are treated with dignity and respect, (2) The CEO is personable and uses “random walk” to talk to employees informally.  Employees said they want to see the CEO, touch him and talk to him, (3) Knowing what is going on in the company and how it is doing.  The reasons for decisions.  Communicating the why for a downsizing and the alternatives. (4) In bad times management and employees are treated the same. (5) All of which leads to “trust” of management, an important factor. (6) Money or salary was not a prime factor.

Interestingly terminated employees in a downsizing within these Best to Work for Companies were often understanding and productive while working their last day on the job.

Companies considered by employees to be the “Best To Work For” companies tend to be best performers.

See Fortune’s February 4, 2002 magazine article “100 Best Companies to Work For”.