A company’s employee engagement has an impact on everything from absenteeism to turnover to the bottom line. In a 2012 study of 50 global companies, Towers Watson found that businesses with low engagement have an average operating margin of just under 10 percent compared with 27 percent for those with the highest engagement score. And companies with a highly engaged workforce are 22 percent more profitable than others, according to recent research from Gallup, which studied about 1.4 million employees from 192 global organizations.
But mission-driven companies can’t assume their employees are engaged simply because they care about people and the planet. It takes some doing. Social enterprises like West Paw Design are finding innovative, successful ways to tap their employees’ creativity and ingenuity, which in turn boost employee engagement.
What They Do
For the past nine years, the folks at West Paw Design in Bozeman, Montana, a maker of pet toys, beds and mats, have sponsored a company-wide competition in which teams of employees devote half a day to designing new products. The winners earn the coveted Golden Hairball Award, a dilapidated trophy with a base resembling a gold, spray-painted paper towel roll crowned with a cat toy.
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“It inspires people to share their creativity, ideas and talent, not so they can build their career or make huge sums of money, but to contribute to the company,” says Spencer Williams, president of the 70-employee firm with about $10 million in annual revenue. “It’s all about how can we help move the business forward. And it’s fun.”
How They Do It
In the beginning, employees would submit ideas to a production manager and, at the annual holiday party, managers would choose the best concepts and give the winning employees a gift card. But that approach lacked any element of a collaborative campaign and, says Williams, “It shouldn’t be just management deciding which are the good ideas.”
Today employees work in groups made up of people from every department. Each team comes up with four or five ideas for products, anything from a chew toy to a doggie bed. They spend the morning brainstorming and two frenzied hours in the afternoon scavenging for materials and using the company’s injection-molding equipment to produce samples. Then they craft a presentation, complete with pricing and marketing strategies.
Employees pitch their products to their colleagues, and then vote for them based on commercial viability. In addition to just the Golden Hairball competition, employees vote for the “People’s Choice” — the product they just think is the coolest.
After the festivities are over, the Research and Development team considers all the submissions to see which of them can be turned into real products. The winner in 2014, a flat dog bed made with microfiber, is now the company’s fastest growing bed line, with more than 16,000 sold to date. Not only did the collaborative campaign result in a major success for West Paw Design, it also boosted employee engagement. Engineers and marketers are investigating whether to produce the most recent winner, a dog toy in the shape of a fish.
As of last year, the teams are required to meet a few criteria. For instance, pet-toy designs in 2015 had to be either especially stimulating or especially durable. Chad Oster, an IT manager who was on the winning team, enjoyed the challenge. “You need to have some boundaries to help you keep your focus,” he says. “It’s always more difficult when you look at a blank sheet of paper versus having a goal you can work toward.”
Oster has also participated on his fair share of losing teams during his seven years with the company. “It’s really fun to win, of course,” he says. “But we always have a good time. People are genuinely excited by this event.”
Williams likes to measure West Paw Design’s success in hard numbers, and he says employee engagement scores have increased significantly since the employees started competing for the Golden Hairball.
This content originally appeared in the Pathways department in the Fall 2016 issue of B Magazine. Read more about employee-engagement initiatives from the same issue: How an Employee-Driven Stewardship Council Can Raise B Impact Scores, Harry’s Hackathons Thrive Through Community Building, Crafting Quick and Effective Business Solutions With Engineers.
Image courtesy of West Paw Design.