Forum

Tom Atkinson, Director of Customer Research

I interviewed Jim Simmons (a pseudonym) recently.  A sales executive for a leading provider of health insurance plans, he is responsible for leading a sales force of independent agents in New England who offer health coverage to employees of companies through the companies themselves.  A particularly challenging aspect of Jim’s role is that the agents he leads do not report to him:  they are independent businesspeople who sell policies on a commission basis.

Managing people who sell insurance, even in good times, is a demanding profession.  Turnover can be high, especially among newer agents who have difficulty getting started.  A key ingredient of salespeople’s success, Jim’s company discovered, is a supportive organizational climate.  In fact, it was found that 71 of the company sales units with the most positive climates performed above average, while only 18 percent of those with negative climates did.

Stated simply, “climate” is what it feels like to work in a place.  Are people encouraged to work in teams—or does the company mostly reward individual initiatives?  Are processes crystal clear—or is there flexibility in how the work is done?  Are there explicit standards of performance—or do people follow their gut feel?  There is no single type of climate that is right for every work setting:  contrast the Navy Seals with a luxury hotel, or an overnight delivery service with a company that designs web sites.

Decades of research conducted by Forum and others have shown that climate is a measurable, powerful factor of driving employee engagement and performance.  Unlike culture, it can change quickly—and it can have pervasive effects on how people perceive the work environment and whether or not they exert the discretionary effort it takes to excel in the environment.  Think of the tone set by a new manager or how the atmosphere changes when people join or leave a team.

One might expect that climate would suffer during an economic decline, as salespeople encounter more resistance in the marketplace and have greater difficulty meeting their targets.  “Jim” found the opposite, however.  By focusing his attention on fostering a positive climate—by providing clarity of direction, recognizing superior effort, and fostering teamwork, for example—he actually improved the climate of his unit during the economic downturn.  The enhanced climate is helping his people stay motivated and perform more effectively in a challenging time; it is preparing them to come out on top when the economy rebounds.

Here are some tips for keeping your employees motivated, especially during tough economic times:

Don’t

• DON’T assume that all your employees are motivated by the same things.  Some may relish public praise while others prefer a private comment or note acknowledging their accomplishments.
• DON’T focus exclusively on business results or other lagging indicators.  Pay attention to how motivated your employees feel and find ways to help them perform more effectively—and the results will follow.
• DON’T confuse a positive climate with fun and games.  A productive climate challenges people in addition to supporting them.

Do

• DO think about the kind of climate that would best support the business objectives of your people.  For example, what kinds of clarity about the work group’s direction and goals do they need?  What kinds of standards of performance should you set?  Do your people value working as a team?
• DO conduct regular climate “temperature checks” to ensure that your people are motivated.  Conduct informal discussions of the climate with your people—including people whose perspectives may differ from yours.
• DO find out how your people view your management practices.  What actions do they observe you taking that affect the climate positively or negatively?  What would they like to see you do more of, do less of, or do differently?