The Hidden Value of Employee Recognition

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The Hidden Value of Employee Recognition

Guest writer Kurt Pease tackles employee turnover in this week’s blog post, “The Hidden Value of Employee Recognition: Why a Paycheck Isn’t Enough.”

High employee turnover is a major pain point for businesses. We often assume money is the main reason people leave, but a recent Gallup poll shows job dissatisfaction hitting record highs. The truth is employees crave more than just a paycheck. They want to feel valued and see how their work contributes to the bigger picture.

This was certainly true at 4Rivers Equipment, where I recently retired. We considered ourselves a great place to work, but higher employee turnover told a changing story. Exit interviews revealed a disconnect between our perception and employee needs. The younger generation wanted to feel their work mattered. The CEO at 4Rivers knew we must act quickly and asked his leadership team for ideas.

Recognition: The Missing Piece of the Puzzle

Thinking back to my experience at John Deere, I remembered their successful employee recognition program, “John Deere Rewards.” It fostered a sense of connection and appreciation. We reached out to Greg Mazucco and Cori Karger from Augeo Marketing to help build a similar program that they developed at John Deere.  Greg and Cori outlined how to build a successful workplace engagement program:

Building a Recognition Program that Works

Here’s what we learned about creating an effective program from Greg and Cori:

  • Clear Goals: Recognition shouldn’t be random. Define your program’s mission and align it with business objectives.
  • Leadership Buy-in: Senior leadership needs to be actively involved. Recognition becomes a top-down and bottom-up effort.
  • Launch with Impact: Don’t bury the program launch in a memo. Make it a company-wide event to generate excitement.
  • Sustained Focus: Recognition shouldn’t be a one-time thing. Regular appreciation is key.
  • Meaningful Budget: Allocate a dedicated budget for rewards. Even non-monetary rewards should have value.
  • Defined Recognition Tiers: Establish guidelines for different levels of recognition with clear criteria.
  • Visibility Matters: Public recognition walls can be a great motivator. Offer options for private recognition as well.
  • Peer-to-Peer Recognition: Encourage recognition across all levels, not just managers.
  • User-Friendly Platform: Make participation easy and accessible. Consider a user-friendly online platform like social media.
  • Onboarding Integration: Introduce the program during onboarding to set expectations and highlight company culture.
  • Values Alignment: Clearly connect your company values to recognition programs, showcasing how employee contributions support those values.
  • Data-Driven Improvement: Track recognition metrics and use the data to identify areas for improvement and correlate recognition with employee satisfaction and retention.

Dealership Implementation

I was fortunate in my career to not only work at John Deere and 4Rivers Equipment but developed relationships across the dealer network. Five Star Equipment was an important dealer to me and partnered with Greg and Cori to implement an employee recognition program, and the results speak for themselves.  I spoke with key leadership personnel from both dealerships to gain insights into their programs’ success.  

They are:

  • Hannah Ross – Vice President of Marketing 21st Century & 4Rivers Equipment
  • Lori Snider – Director of Human Resources – 4Rivers Equipment
  • Elena Seidita – Director of Human Resources – Five Star Equipment
  • Tim Stevens, Recruiting and Training Manager – Five Star Equipment

Why Recognition?

Both dealerships identified a need to address employee engagement, particularly among younger generations, 4Rivers & Five Star highlighted the desire for employees to understand how their work contributes to the “bigger picture.” Rising employee turnover prompted them to seek solutions.  

Program Highlights

  • Early Integration: Both dealerships introduced the programs during onboarding. 4Rivers named their program “Peak Performance,” emphasizing achievement from the start.
  • Breaking Down Barriers: The programs eliminated departmental silos. The dealers emphasized how exempt employees can now recognize non-exempt colleagues across departments, fostering a more collaborative environment.
  • Expanding Recognition: The programs go beyond just rewarding outstanding work. Five Star now recognizes safety achievements, birthdays, anniversaries, and veterans. 
  • Core Values Integration: Both dealerships tied recognition to their core values. 4Rivers utilizes “challenge coins” to acknowledge employees who exemplify these values. Five Star emphasized the importance of employees seeing the connection between their work and the dealership’s core principles.
  • Engagement & Retention 4Rivers stressed the link between manager engagement and employee recognition. By acknowledging good behavior and creating context for performance, employees are more likely to go above and beyond. Both dealerships reported significant reductions in employee turnover.

Areas for Improvement

  • Accessibility: Five Star acknowledged the need for ongoing education, particularly for technicians who may not have daily access to the web-based portal.
  • Manager Participation: 4Rivers mentioned that some managers are more active users of the program than others. Utilizing engagement metrics allows them to identify areas with low participation and potentially higher turnover.

The Takeaway

4Rivers Equipment and Five Star Equipment demonstrate the power of well-designed employee recognition programs.  By fostering a culture of appreciation, breaking down barriers, and aligning recognition with core values, these dealerships have seen a significant decrease in employee turnover.  In the competitive world of equipment dealerships, investing in employee recognition can be a game-changer.

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Market Share, Sales Participation and Closure

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Market Share, Sales Participation and Closure

Guest writer Kurt Pease is back with a blog post on the topic of “sales participation, market share, and closure,” and the ways these elements can be improved upon in your business.

Leadership teams at both the dealer and manufacturer levels dedicate considerable attention to strategizing ways to expand their customer base. The primary objective behind this effort is to increase revenue by attracting a larger number of customers. Stakeholders from both the dealer and manufacturer levels are inclined to invest in companies that consistently demonstrate year-over-year growth in profitability. The term market share is the most used metric to gauge growth. Participating and closing deals are both terms that directly impact market share. Let’s dive deeper into these concepts:

Market Share:

Market share refers to the percentage of total sales within a specific market that a company or product holds. It is an important sales metric that indicates a company’s competitiveness. A higher market share often leads to a larger customer base, increased parts and service needs, and higher dealer revenue. The Association of Equipment Manufacturers (AEM) collects data on new equipment sales from participating original equipment manufacturers (OEMs) to calculate market share. This data is categorized by county, machine type, and horsepower. Market share is determined by dividing new dealer settlements by the aggregate AEM data, typically reported on a monthly, year-to-date (YTD), fiscal year-to-date (FYTD), or rolling 12-month basis. Sales participation and closure directly impact market share.

Sales Participation:

Sales participation measures the engagement of a salesforce with their assigned customer base. The goal is to achieve a 100% participation rate, where every customer provides an opportunity to quote when purchasing equipment. This metric is calculated by the dealer or manufacturer using new dealer settlements and AEM industry data. The formula is:

(New Equipment Settlements + Quoted but Lost) / (Industry Settlements – Dealer Owned Rental Fleet)

“Quoted but lost” refers to quotes entered into the dealership’s customer relationship management (CRM) system, which either result in equipment purchases or are marked as lost customer sales. The dealer-owned rental fleet is excluded from the denominator to focus on sales influenced by the sales process.

Closure Rate:

The closure rate calculates the percentage of deals in which the sales team participates but does not close. Reasons for non-closure can vary, including customer brand preference, machine availability, salesman-customer relationship, and pricing. Price is often cited as a primary reason for non-closure. On average, dealers participate in 50% of opportunities and close approximately 50% of those deals. Multiplying these percentages together gives an estimated dealer market share of 25%. When forecasting an increase in market share, it is important to identify whether the focus will be on increasing participation, closure, or both.

Increasing Sales Participation:

One method for increasing sales participation is to utilize UCC1 data during sales meetings for salesperson coaching and customer engagement. For example, the UCC1 new equipment data can be downloaded into mapping software, which helps visualize customer and machine details. This approach enhances engagement and response from sales teams. Sales meetings provide an opportunity to review past sales details, use the map and data points to identify customers who purchased from a competitor, and check if quotes were generated by the assigned salesperson in the CRM.

Follow-up questions to be asked:

  1. Was the customer identified in the CRM?
  2. How is the customer call frequency classified in your CRM? (A, B, C, D, or E). For example, were they to be called on a weekly, monthly, quarterly, semiannually, or annual basis?
  3. Based on the CRM details, did the salesperson complete call reports based on call frequency?
  4. Did the salespeople participate in the deal?
  5. Why did we lose the sale (closure)? Possible reasons include price, availability, equipment features, and salesperson relationship.

If we participated and lost the deal, at least we earned the right to quote. However, if we did not establish a relationship by not calling on the customer, it presents an opportunity for further investigation. Sales managers can ask key questions based on CRM data to gain insights into customer engagement and sales performance. Understanding the reasons behind lost sales and integrating them into future strategies is crucial for increasing market share. Increasing market share requires actively participating in more deals and closing on those opportunities. Awareness alone is not enough; salespeople must quote to generate market share.

It’s worth noting that customers may not always share the real reason why they did not purchase from your salesperson, making it an imprecise science. Price is often given as the reason for a lost sale. Understanding how sales participation and closure rates are calculated, as well as the underlying data that drives these metrics, is critical for effectively increasing market share.

By understanding the importance of market share and the data that drives this metric, leadership teams can manage their sales teams and lay a sound foundation to generate year-over-year growth in both revenue and profitability.

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My Journey of Career Growth

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My Journey of Career Growth

Learning Without Scars is pleased to introduce our new guest writer, Kurt Pease. He was born on June 8th, 1961, in Portage, Wisconsin. He grew up in Whitewater, Wisconsin, in a family where his father worked as a university professor and his mother was a speech pathologist. From an early age, Kurt was instilled with a strong work ethic that would shape his future endeavors. His writing focuses this week upon those endeavors in, “My Journey of Career Growth.”

After completing his education, Kurt graduated from UW Whitewater in 1983 with a BA in marketing. He embarked on a successful career spanning several industries, where he held various management positions and achieved notable accomplishments.

In 1985, Kurt joined Sherwood Medical in Chula Vista, California, and later in Tijuana, Mexico. As a Master Scheduler and Production Planner, he was responsible for material, production, and sterilization control. During his tenure, Kurt designed and computerized the Production Plan, leading to increased efficiency and reduced backorders by 200% while maintaining low inventory levels. He also played a key role in implementing MRP software.

In 1987, Kurt joined Interactor America in Elkhorn, Wisconsin, as the National Sales Manager. In this role, he oversaw aftermarket sales and marketing activities, including dealer development and profit and loss accountability. Kurt successfully created a nationwide dealer organization and significantly increased potential income to $25 million through targeted dealer benefits. Additionally, he spearheaded the establishment of a $5.5 million wholesale market, representing 20% of corporate sales.

In 1993, Kurt joined John Deere Construction Equipment Company in Moline, Illinois, where he remained until 2017. He held various positions of increasing responsibility, including Territory Sales Manager, Sales and Marketing Manager, and Product Manager. As a Territory Sales Manager, Kurt promoted the sale of products and services to dealer/channel partners in the western United States. He excelled in building relationships and resolving issues between channel partners and the company. In his role as Sales and Marketing Manager, Kurt achieved outstanding results, with annual sales exceeding $80 million and independent distributor sales totaling $20 million. He also assumed the position of Product Manager, where he initiated a start-up program through the Deere dealer channel, overseeing new product development, inventory management, and advertising and promotion.

From 2017 to 2019, Kurt worked at John Deere Financial in Johnston, Iowa, as a Regional Finance Manager. He trained and coached finance managers to improve sales performance and increase market share. Kurt also developed effective channel partner relationships and supervised a team of six employees.

Most recently, from 2019 to 2022, Kurt served as the Director of Customer Support at 4Rivers Equipment, a John Deere and Hitachi dealer, located in Greeley, Colorado. In this role, he led the agricultural and construction organizations’ product support business efforts, aligning with financial and operational objectives to maximize profitability. Kurt excelled in attracting, retaining, and effectively engaging department personnel.

Throughout his career, Kurt Pease has achieved numerous accomplishments, including coaching, and motivating the largest dealer territory to maximize market share, creating replacement component programs and independent dealer organizations, and driving significant sales growth. His leadership, strategic thinking, and ability to build strong relationships have been instrumental in his success.

Currently, Kurt is semi-retired working for a local medical school. In his free time, he enjoys fly fishing in the rivers of the Colorado front range.

My Journey of Career Growth: Cultivating Relationships and Embracing Opportunities

In the journey of my career, there were pivotal moments that shaped my trajectory, often propelled by cultivating relationships and embracing opportunities outside my comfort zone. These two elements, although requiring effort and personal commitment, had a profound impact on my growth and success.

Building Meaningful Relationships

Building meaningful relationships is the cornerstone of any successful career. Whether it’s with colleagues, mentors, or industry peers, the connections we foster can open doors, provide valuable insights, and offer support during both triumphs and challenges. It is often surprising how these connections can come from individuals we least expect. Throughout my career, I have found that every position change or promotion was a result of a relationship that had been previously cultivated. My resume was rarely the deciding factor; rather, it was the bonds I had formed with others. People do business with people, and they prefer to work with individuals they have developed a relationship with. We naturally gravitate towards those who share common bonds and experiences.

During my college years, I worked as a night auditor at a popular resort. It was a wonderful job that allowed me uninterrupted study time once I completed my bookkeeping duties. It was during this time that I met Joe, a German sales and marketing executive at Interactor, a construction component manufacturer. Every night, Joe and I engaged in conversations that lasted for hours. From him, I learned invaluable insights about working for a multinational company, knowledge that college didn’t provide. Joe sensed my eagerness to learn, and even though we lost touch after I graduated, he tracked me down several years later in Tijuana, Mexico, and offered me a role as a Customer Service Manager working with companies like JI Case and John Deere. This opportunity became my foothold in the construction equipment industry. From there, my career flourished, moving from one company to another, consulting at John Deere, and eventually leading to a long and fulfilling career in that industry.

As I progressed in my career at John Deere, from Product Manager to Sales and Finance Regional Manager, I discovered the importance of reciprocity in relationships. By offering support, sharing insights, and actively engaging with others, I not only strengthened my professional network but also cultivated a sense of camaraderie and collaboration that proved invaluable in achieving common goals.

Embracing Uncomfortable Opportunities

Embracing uncomfortable opportunities has also been instrumental in my professional growth. Stepping outside of my comfort zone allowed me to learn and advance in ways that familiarity cannot offer. While the familiar may offer security, it’s often the unfamiliar territory that presents the greatest opportunities for growth. After completing my undergraduate degree in the Midwest, I decided to explore life outside of my comfort zone. My sister had landed in San Diego, and she offered me a place to live while I sought out my first post-college job. It was 1983, and the job market was tough. I was pushing out resumes with little success until a HR manager called me for an interview in southern San Diego. To my surprise, the company was looking for a Master Scheduler for a Maquiladora in Tijuana, Mexico—a role that required scheduling a factory that produced medical disposables. I knew nothing about factory scheduling, nor working in a foreign county, but I spent hours with the Plant Manager, who patiently taught me the ropes. Despite my initial apprehension, this experience taught me how to work in a plant environment where Spanish was the primary language spoken. It was a leap that bolstered my confidence and broadened my horizons. I grew up during those two years, crossing the US-Mexico border every day.

Taking calculated risks has also been a defining factor in my career progression. Whether it was pursuing a new role, exploring a different industry, or spearheading innovative initiatives, embracing change and uncertainty allowed me to seize opportunities for growth and advancement that I might have otherwise overlooked.

The Intersection of Relationships and Risk-Taking

What I have come to realize is that the most significant leaps in my career have often occurred at the intersection of cultivating relationships and taking calculated risks. The synergy between these two elements has propelled me forward in my professional journey. Leveraging connections to explore new opportunities and drawing on support networks to navigate unfamiliar terrain has been transformative. The trust and rapport built through meaningful relationships have served as a catalyst for venturing into uncharted territory with confidence and support. Knowing that I have a network of mentors, colleagues, and allies cheering me on has emboldened me to embrace uncertainty, seize opportunities, and continue evolving as a professional.

Conclusion

In retirement, I have decided to venture beyond my comfort zone by working at a local medical campus. Stepping into the realm of education and mentoring, I am ready to share my wisdom and experiences with aspiring medical professionals. Working at a medical campus will not only challenge me intellectually, but it will also allow me to connect with the next generation of doctors, nurses, and healthcare professionals. It is a chance to inspire and guide these eager minds as they take their first steps towards making a difference in the world of medicine. Although this new journey might be unfamiliar and require adaptation, I am excited to embrace the challenges and enrich my retirement years with meaningful engagement and the satisfaction of nurturing future healthcare leaders.

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