LIFO helps General Electric Increase Productivity
From www.StuartAtkins.com

The New Corporate World is Flat - Cutting Costs and Increasing Customer Satisfaction
Through Employee Empowerment at GEJohn Wilfore, Sub-Section Manager, Business Information Center, General Electric Co.John Wilfore had been a part of General Electric's hierarchical structure nearly thirty years when he was mandated to "de-layer," including eliminating the layer he shared with two colleagues and outplacing them. He was a sub-section manager at GEs Business Information Center (GEBIC) in Albany, NY. The only guidance he was given was to "create a self-directed workforce." None of his peers knew what that meant. It wasn't even in the dictionary.

Richard Costello, the head of Corporate Marketing Communications, told him he could explain the theory, but not the "how." They called a meeting of the new "flat" organization. John hypothesized that "self-directed" must mean that others would contribute to the solution. But the first meeting wasn't magic.

Ultimately, they and the other employees hired an outside consultant, Gary Martini of Martini & Associates in Minneapolis. "If you prepare people by building a strong team," Martini outlined, "then they can handle most problems. But if you start with the problem before people are ready with the necessary skills, you're asking for trouble."

So, what was the first step? Flying the fledgling team to Orlando for a two-day LIFOŽ workshop. "I'm not sure a lot of people begin by focusing on soft skills," says Witfore, "We did -- people, skills, mission, then the rest."

Back at GEBIC, each person's LIFOŽ scores were posted on the Strength Feedback Chart, which were then used to record their team's perception of them. "This pulls people together," says Linda McClain, who attended the LIFOŽ training on her second day at GEBIC. "The LIFOŽ Strength Feedback Chart and the human graph contributed to an appreciation for team strengths, weaknesses and balance."

"LIFO," according to team member Tom Lee, "in all honesty, is the keystone for empowerment, team building. Empowerment, sometimes misunderstood, has been well-defined at GEBIC. Now, we're all very much equal."

"When people can't work together," continues Lee, "productivity goes down. But if the team succeeds, everybody will succeed."

Wilfore knew from the beginning that de-layering leaves extra work to be done that fits into nobody's job description. The staff's question would be, "What's in it for me? Why should I be doing all this extra stuff?" He, along with the rest of upper management, made a profound commitment to employee personal growth, learning new skills and having the opportunity to enhance their jobs. GEBICs responsibility is fielding outside calls from industrial customers or prospects who do not know whom to call in the sprawling conglomerate of GE corporations and subsidiaries. This gives outsiders a personal liaison to refer or take them to the experts or other GE organizations they need. Besides counting phone calls to measure productivity, the team created ways to measure customer satisfaction -- their target.

When the self-directed work team approach began, their call volume per employee was 3,698. In just two years, it rose 53%, to 6,105. And costs? Cost per call during the same period plunged 34%, from $31.76 to $20.80.

Concerned that continuously increasing call volume might put undue pressure on the phone answering team and support staff, management sought outside proposals for a new rewards and compensation program. When the team members got wind of the costs ($50,000-$75,000) and the time required (6-18 months), they screamed "Outrageous!" and asked to be allowed to develop their own rewards program.

The team established three criteria for a bonus:

• Teamwork would override individual effort (especially since support staff and not just phone answerers with measurable volume were on the team).

• The bonus program would focus on meaningful business issues.

• Rewards would be linked to customer measurement. Management would participate in the same bonus program! Total cost? Less than the cost of the proposals from the outside developers.

But the benefit was more than monetary. It ensured no one would coast while others worked, and it continually focused them on what was really important about their jobs: customer satisfaction.
How did management both engage the team members to increase productivity while at the same time hone skills to improve customer satisfaction? Though all team members had been LIFOŽ trained, GEBIC brought in a trainer to LIFOŽ certify a sub-team (one-quarter of the whole team). Professional growth was phenomenal.

"The first two sentences a customer says on the phone," says McClain, "enable me to put them into a [LIFO] window. Becoming a LIFOŽ trainer is what enabled me to get to this level of skill. I know I can identify their style and then communicate to them quickly in their style." She describes how the team immersed themselves in the homework for the LIFOŽ certification class. They were asked to look through magazine articles and watch TV commercials to practice identifying styles. "We all brought in three magazine articles. We were really into it. That developed our phone skills quickly."
Personal rewards and general job satisfaction were up, too. Jacquie Braam, a team member from the beginning of the changeover, says, "LIFOŽ not only empowers me as an individual in terms of my interaction with other people, but enables me to empower the other people I am dealing with. When you understand their strong points and blind sides, you both interact more effectively. For example, if I know my boss likes a lot of detail and nitty gritty, I'm going to be prepared when I present a new idea to him. I am operating from a basis of strength and he isn't flustered, so he is empowered, too."

"I always look at it as me trying to help other people more than how it has benefited me," says Steve McKinley, another certified LIFOŽ trainer on the team.

The GEBIC team educates new hires swiftly, explains Braam, through an eight week program of blended mentoring and classroom training. "We try to level the field as quickly as possible when they come on board. We start with LIFO, then bring them up to speed on the other trainings we've had, such as team dynamics and how to run a meeting."

"LIFOŽ skills are second nature to us," describes McClain, "so we don't use the language as much as we used to except on the advisory team. But with a new person, the excitement starts all over again!