Concepts of Management INC. Case: You can buy Employee happiness. But should you

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Concepts of Management INC. Case: You can buy Employee happiness. But should you

What 2 motivation lessons can be learned from Aurora Electric?

You Can Buy Employee Happiness. But Should You? | Inc.com

That logic is taken to another level at Aurora Electric, a Jamaica, New York-based electrical contractor that works on large, complicated projects, including the World Trade Center in Lower Manhattan. At its core, the company has just four employees, but that number rises to as many as 50 depending on how many projects the company has under way. And all of them get lavish benefits--even though many are union electricians who join the work force on a project basis. (Under union contracts, employers provide coverage; they are required to meet certain minimum requirements but free to go above and beyond.) Aurora’s perks include complete funding of what founder Veronica Rose describes as a “Cadillac health plan that covers everything, including wellness programs and even a 30-day drug or alcohol rehab program.” The company also offers a tuition-reimbursement program that employees can use to build skills in any field, not just construction or electronics.

Veronica Rose, founder of Aurora Electric, specializes in big, complex projects, such as the construction of One World Trade Center in Lower Manhattan. Most of her workers are union electricians, whose contracts mandate decent benefits. But she provides gold-plated perks. Why? "It creates a much better work environment," Rose says.

Rose’s union electricians are not payrolled employees. So why invest in the kinds of benefits that most companies justify in large part for the impact such perks have on retention? “It creates a much better work environment,” Rose says. “Everyone is much more engaged. Instead of running to me with every little thing, they help each other.”

Rose admits that she views treating workers well as an end in itself. But the practice also has a serious business rationale. “We only do very specific kinds of electrical work,” she says. “We need electricians who have the highest security clearances, who have years of training in fiber optics and related technologies, and have pursued credentials on their own time. I need the cream of the crop, and they are hard to find. So I create an environment in which everyone wants to come and work for me.”

Rose’s instincts--that a well-designed benefits package can yield real, bottom-line results--are echoed by a number of business leaders. “Not enough company leaders try to quantify the results of providing both a good company culture and a good benefits package,” says Paul Spiegelman, founder of BerylHealth and The Beryl Institute and chief culture officer of Stericycle, a medical services company with 13,000 employees.“Historically, companies have relied on their financials as leading indicators. But employee satisfaction, customer satisfaction, attrition rates, and similar metrics should serve as your leading indicators, with financials becoming your lagging indicators.”

When managers begin correlating one metric to another, Spiegelman says, they “begin to see the relationship between investing in your employees and financial results.” Spiegelman’s own experience provides a case in point. A few years ago, his companies began offering a new health benefit--the opportunity to see a registered nurse within two hours, either at work or at home. There was an almost immediate payback: In just four months at Beryl, for example, 71 insurance claims were avoided and 246 work hours were saved (equating to an estimated $18,000 in wages) as employees got immediate care rather than having to visit a doctor.

Explanation / Answer

One of the first motivation lesson that can be learnt from Aurora Electric is that creating an aspirational workplace needs an initiative from the top to do the things in a manner that your competitors are not, in this case offering gold-standard health coverage plans for shop-floor workers is unheard of across the industry.

Secondly, by providing the best facilities for your employees you are creating a strong sense of loyalty, empowerment amongst your employees all of which comes back to you many times over as can be seen in the example where having employees on a new health benefit led to gains made in lesser insurance claims, work hours lost.

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