Warming the Cold Heart of Business

By Dutton, Gail | Management Review, June 1997 | Go to article overview

Warming the Cold Heart of Business


Dutton, Gail, Management Review


After years of tough decisions, business is reinvesting in people.

Downsizing. Cost-cutting. Mergers. Consolidation. These were the trends for at least the past decade, and they left an unexpected legacy. Business lost its heart and some say, if it ever had one, its soul.

"Today, people don't feel loyalty to the institutions where they work and don't equate the workplace with moral or ethical behavior," says Adrian Zackheim, publishing director for HarperBusiness. He's right, and the result is demoralized workers and cynical customers.

Jerald Greenberg, professor of business ethics at Ohio State University, wants companies to know that "managing people effectively isn't a luxury for good times." Now businesses are working to mend the broken hearts and empty faith of employees with strategies that range from benefits perks and community involvement, to renewed emphasis on integrity.

"I'm sensing that all companies that went through cost reductions and downsizing in the '90s focused on the softer benefits without a bottom-line impact," says Patricia Nazemetz, director of human resources, policy and practices at Xerox Corp. "It's partly a leap of faith."

Xerox and the like are gambling that creating a better work environment by relieving some of the employees' stresses will help them become more focused on their work. These companies also hope that the friendlier environment will attract and retain the highest-caliber people. "Employee-support programs make it possible for people to concentrate on work. They also attract people who otherwise might not be able to work there," Greenberg says. "The programs send a message that the company cares about its people."

According to Marianne Jennings, professor of legal and ethical studies in business at Arizona State University, "Some [companies] are reporting that they get better applicants just because they offer good daycare nearby or on-site."

Keeping the Force

At Xerox, those softer benefits include flexible work schedules, mutually agreed-upon "quiet times" when all interruptions are banned, and a wide range of work/family initiatives, such as child- and elder-care referrals, adoption subsidies and counseling, and educational information. Xerox is also offering an intriguing concept known as "benefits credits." "Employees' needs are changing, and one-size-fits-all benefits don't work anymore," Nazemetz says. "We need programs we can finance. So, we give each employee a $10,000 credit to use throughout his or her career for specific life needs. So far, designated uses include mortgage assistance for first-time home buyers, childcare subsidies to help employees find better-quality childcare, and healthcare benefits that can be extended to parents and siblings."

When these programs began at Xerox's Dallas sales/service office, sales revenues exceeded expectations, customer satisfaction improved and absenteeism dropped 30 percent. When they were introduced at the Webster, N.Y., plant, the Xerox 4900 desktop color printer was completed on schedule--a rarity for the industry.

We've always had the belief that people really are an important part of the organization," Nazemetz says. "Our culture values diversity, and we have a balanced workforce in terms of approaches, ethnic background and gender. Additionally, we've come from a paternal, entitlement environment, to an adult-to-adult culture." Of course, there's always a percentage of employees who will never be happy with anything. Instead of catering to them, Xerox focuses on the much larger group that wants to be a part of the team.

To ensure benefits are on the right track, the company conducts employee-motivation and satisfaction surveys. "We look at how employees feel about the company leadership, their work and being at Xerox in general, and link those responses to such indicators as turnover and sick leave," says Nazemetz. …

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