What do we owe an employee?

 This is the second of a series of posts on Sharing Information with Employees, a 1942 book I've found that I believe is the first ever written on the subject of employee communication. In the first post, we discussed the author's familiar sounding explanation of the purpose of employee communication. This post takes us further afield from the current thinking. —DM

Like every employee engagement consultant and entrepreneur boss you meet on today's streets, Alexander Heron believes the purpose of employee communication is to inspire the employees to take "ownership" of their work. But Heron argues that employees inherently have an ownership of their jobs, and it's the company's responsibility to honor that ownership and help make the employee a more intelligent, broad-thinking actor.

And responsibility, as we're about to learn, is not a word Mr. Heron is afraid of. Listen to him describe the difference between what the company owes a day laborer—"He has given us eight hours of honest work as he agreed. We have given him $4.80 as we agreed. He owes us no more; we owe him no more."—and what it owes a long-term employee:

Assume that the second man was twenty-five years old the day he came to work. He "fitted in," he learned our ways, he gained experience, he acquired new skills, he took on new responsibilities. As he did so, his rate of pay was fairly increased. As the years pass he is suddenly forty years old—above the average age of employees in American industry. He has been our employee for fifteen years. His present rate of pay is $1.00 an hour. His average rate for fifteen years has been eighty cents. He has given us 30,000 hours of honest work. We have paid him $24,000, at the successively agreed rates. Can we close the books on him? Can we say he has given us the agreed hours, we have paid him the agreed dollars, and there is no more owing, by him or by us?

Hell yes! cries the modern corporate manager, as he or she has done since corporate America two decades ago blithely declared the end to any kind of contract between employees and management. Be your own free agents, they said. Manage your own career. You're all mercenaries—we're all mercenaries! But Heron responds:

He has put into the job more than the 30,000 hours. He has put into it, into the enterprise, fifteen years of his life. They are not just fifteen years, either; they are the fifteen years which should be the foundation of all his later life earnings. Those years are his investment in the enterprise. We cannot give them back to him. We can pay off a bond-holder, or buy out a stockholder; but we cannot buy out the investment this worker has made. We wanted him to stay with us and put in those years. We want him now, as through the years, to protect and promote the business which is his job, as if it were his own. And it is his own in a way which neither he nor we can change. He is not the same man at forty than he was at twenty-five; the difference has been invested in the enterprise.

I know what you're thinking. So does Heron:

True, he has gained in some ways. He has gained skills, knowledge, maturity. He may have gained some reputation for special expertness in some line. He may have money in the bank, an equity in his home or in a life insurance policy. On the other hand, he has lost youth, adaptability, salability. He has lost fifteen years of the promise of future usefulness to any enterprise. He has risked or staked his chances of employment and income, during middle age and later years, on the future soundness and success of this enterprise. He can take away from him his acquired skills, knowledge, and reputation; he cannot withdraw the investment of the years of his youth. The important question is, has he invested those years or merely spent them?

The case is tragic when a man so invests his priceless years in an enterprise which goes merrily on without him, exploiting the youth of newer, younger men. The case is tragic; but it is very rare. ...

The major tragedy occurs when not one man but many deposit priceless years in an enterprise which they all discover, too late, is unsound. In a year when their habits have become fixed and their heads partly gray, their ages are from forty to fifty and their periods of employment have reached ten, twenty, or thirty years, they find that the enterprise is not the lifetime of security they thought they were buying.

This places on us an obligation, the mutual understanding of which  is the key to constructive co-operation. That is the obligation so to plan and manage the enterprise that it will be the anchorage for middle age which the worker has a right to expect.

What corporate executives were saying when they told employees to be free agents who didn't have a right to expect anything was that they didn't have confidence enough in their strategies to ensure workers an "anchorage" for six months from now, let alone for middle age.

Fair enough. But that's not what they tell investors. They assure investors today just as they did in Heron's day, that they understand the obligation to maintain their faclities, conduct sufficient R&D to keep up with customer demands, stay abreast of the latest business technologies and processes, and created "a personnel in management, production, and sales which has reproduced itself, has trained its understudies."

Employers must, Heron concludes, "render this service to the investor of years as much to the investor of dollars."

And the corresponding employee communication responsibility?

First, we must recognize our inescapable obligation to manage the enterprise in such a way as to furnish middle-age security for those who spend their years of youth in the enterprise as wage earners.

Second, we must encourage them to expect and demand this kind of management as their truest form of social security.

Third, we must share with them the information which will create this attitude and which will continuously show them whether or not their long-time interests are being conserved.

Then and only then can we expect to find them shaping their attitudes and actions in terms of the future security of the enterprise in which they have such a priceless stake.

We can dismiss all of the above as hoplessly old-fashioned only until we realize that it's merely an exaggerated, absolutist-sounding version of the values of the companies—how they dwindle!—that we still most admire.

Southwest Airlines, for instance, wouldn't shrink from this basic philosophy. Neither would S.C. Johnson, with which I've had long and happy association, or Northwestern Mutual or Wegmans, for which I've also worked. You think Bill Gates would think of all this as so much sepia-toned silliness? No, he'd say: I did my best. Ballmer, you're up next.

In our next installment, Heron asks a question whose relevance in the post-meltdown climate shocks the senses:

"Are we, as employers ... ready to see that our free-enterprise system is doomed unless it can be understood by the great majority of our citicizens, constituents, and beneficiaries?"

And he describes quite simply how employee communications people who would go about creating this understanding need only to return to the employee his or her own native economic intelligence by using "the language of ... realism."

Could it really be this simple?

Comments

[Mike Klein]

What an absolute find--going to prove that there really hasn't been an original thought in internal communication in the last 60 years. Well done for unearthing and sharing this stuff!

[David Murray]

I don't care where the original thoughts come from, Mike. I'll take 'em on Twitter, and I'll take 'em in musty textbooks!

[Kristen]

This is almost surreal to me. Throughout the majority of my working career, I have functioned in an emplyment environment that is the polar opposite of what Heron suggests "ought" to be the case.

It has never made sense to me, how the leaders of companies seem to genuinely believe that they can give nothing other than a paycheque [and even that is tenuous nowadays] to employees, but at the same time they feel they can EXPECT those "free agents" to give loyalty, dedication, and commitment to that same organization which will toss them out the door in the blink of an eye, if they think doing so might raise the stock price 2 cents per share.

What I never have been able to reconcile is the fact that by dumping employees, and either outsourcing to other countries, or simply off-loading three times the work onto the remaining employees in order to save money and grind out that 2 cent increase in share price, almost inevitably the quality and service levels the organization then delivers do a free-fall, which typically results in lost customers, more cost cutting, and ultimately the crash and burn of the whole organization. I have personally watched this happen in more than one company I have acually worked for, and many that I haven't

What I have yet to get a reasonable answer to, is this: How come an ordinary employee [me] can figure out that this course of action is ultimately detrimental to the success of the organization, and the supposedly brilliant, highly-paid executives running these companies can't???

I always think that if these fancy execs took one-quarter of the effort they they expend rationalizing to employees why they are being dumped, or given three times the work-load for the same pay, and put it into explaining to the shareholders and analysts why treating the people who deliver the product well, and keeping them working for the company in the long-term is actually better for their returns, we would all be better off.

But apparently, I'm missing something, because none of these high-powered execs ever seem to come to that same conclusion, because no matter how many times the same downward spiral scenario (downsize, lost customers, more cost cutting, more lost customers, bankuptcy) plays out, they keep right on doing it!

[David Murray]

"How come an ordinary employee [me] can figure out that this course of action is ultimately detrimental to the success of the organization, and the supposedly brilliant, highly-paid executives running these companies can't???"

I think the answer to all this is: Everybody's in it for ME--management and employees a like.

It's just that, employees' motivation is to do meaningful work for an organization with a friendly culture that pleases its customers and contributes to the community.

Top executives more typically find their meaning in the thrill of the chase, the status of their job and a big payoff before the whole shit house goes up in flames.

Employees are looking ten and 20 years down the road--college tuition for their kids, retirement, etc.--while executives are looking to next quarter's earnings report and their stock options.

It's not that employees are intrinsically good and execs are intrinsically evil. And of course there are many exceptions to prove this rule: But employees' motivations are different from executives' motivations--even though in a better world they wouldn't be.

[Kristen]

Well, that begs a question I think - are we just whistling in the wind by reading and discussing Heron's book given the world we all now live in?

Or is there a real possibility that we - "we" being Employee Communicators - can actually hope to integrate some of Heron's philosopy back into today's business world??

[David Murray]

The world we now live in is changing because of this economic downturn. People are awake and in pain. Heron was writing at the end of the Depression and at the beginning of WWII.

Now happens to be the best opportunity since that time to think about and yes, hope to integrate, some of these ideas.

[Ron Shewchuk]

I agree with you David. There's been no better time to change the way business operates -- to make it more human -- than right now.

Tell me if I'm wrong, but Heron sounds a lot like Barack Obama's 2009 Labor Day speech, which he hasn't given yet.

[David Murray]

That would be a doozy!

[Bay Jordan]

Fascinating stuff. It might however, also help to put things in perspective that, as Gary Hamel points out in his book, The Future of Management - "The concept of the employee is a recent invention, not some timeless social convention." (P 130) It would seem that the employee was a 20th Century phenomenon, and it may thus be one that has had its time.

Maybe it is time for people to claim back their lives as a personal brand and operate it as a business on the same lines as the employers they currently "serve." That at least is the direction in which my solutions may ultimately be heading.