Managing the New Generation of Employees - Management
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SECTION: Management

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Contact Kim Phelan at (800) 388-0650 ext. 340.

Managing the New Generation of Employees

Written By Kathryne A. Newton

Article Date: 11-01-2005
Copyright (C) 2005 Associated Equipment Distributors. All Rights Reserved.

The top 20 percent of employees in any market will always have a job, but will they be working for you?

It’s often said that you just can’t find loyal employees anymore. I agree, you can’t find them… you have to build them. That’s just one of the ways the new generation of employees is different from yesteryear. We are no longer in an era where all a manager has to do is hire good people and pay them a fair (or almost fair) wage to keep people working for you.

Author, Dr. Kathryne Newton, Ph.D, Purdue University will speak at AED's 2006 Annual Meeting, January 26-28. For more information call 800-388-0650 or to register online, visit

A good manager must do that, plus provide a blend of benefits and company culture that work together to do what essentially boils down to keeping people happy.

Good examples of companies that have been successful at this can be found in Levering and Moskowitz’ book “The 100 Best Companies to Work for in America.” These companies succeeded not only because they have high commitments to the products and services they provide, but also because of the “employee friendly” workplaces they provide their employees.

The key attributes these companies share have less to do with paying high salaries than they do with demonstrating that employees are a highly valued asset. Some examples are:

  • Reasonable commitments to job security;
  • Facilities and policies that exceed the legal minimums;
  • High sensitivity to work-family balance issues;
  • High degree of employee autonomy;
  • Open communication;
  • A sense of “ownership.”
Not convinced? Here’s a telling statistic – a Robert Half International survey found that nearly two-thirds of Americans said they would be willing to reduce both their work hours and their compensation in exchange for more “family or personal time.”

It’s clear Americans’ priorities have changed, and those managers who are progressive about meeting their needs will have a real advantage in the marketplace.

Adopt a Strategic Approach

Managing well today means managing strategically – taking the time and effort to make sure each decision logically balances and supports the key objectives and operations of your company. The figure below illustrates the many areas that managers must balance in order keep employees happy and, most important, productive.

Unless a distributor strategically plans for these components to work together, they may actually get “out of balance” and work against the very benefits the distributor hopes to get from them.

For example, the caliber of employees that a distributor seeks to hire should match the overall management systems appropriate to hiring and keeping them. Sounds logical, but too often distributors are interested in getting and keeping the best employees without exploring what the industry requires to attract and keep them.

Consider for a moment the area of compensation. The best employees will always earn top dollar in any industry. Is your company able to attract them with its current pay system? In compensation terms, your company fits into one of the following categories:

  • A leader – pays better than average
  • A competitor – pays about average
  • A laggard – pays below average
You really do get what you pay for and if you are going to go after a high-caliber employee and pay a leadership wage, you must also recognize and plan for the appropriate training systems that will support the career paths a high-caliber employee will expect.

And… you must have well developed measurement systems and open communications so employees will know the progress they are making and be motivated to continue working hard, and so on.

Get the picture? Each area must support the others – think strategically.

I’m not suggesting that paying an above-average salary is the only way to achieve a balanced management system. You can accomplish a balanced system with a competitive or a laggard pay scale as well, but you’ll have to be creative to make them work together to keep employees happy.

I know one distributor that pays a laggard wage purposefully. They use testing to identify intelligent, but under-skilled, employees and essentially “grow their own.” But, they have invested heavily in education and training programs to support these employees in addition to a strong incentive system and team environment to keep people motivated.

Employees have a strong sense of purpose in the company and are given a lot of “ownership” in how they handle their own work. As you might expect, employees that develop successfully through this company are well paid, but they will have earned it.

That is just one example of how a company can balance a system to meet the needs of today’s employees. Other distributors are already competitive in their pay and benefits and are looking for other ways to keep their employees happy.

Get in touch with what your best employees are looking for and find ways to help them achieve it. Ask yourself, “Are the culture and system components complementary?” Here are a few of the items you should be examining:

  • Internal competition among employees
  • Creativity and innovation
  • Self-confidence
  • Openness of communications
  • Employee and customer participation
  • Customer service orientation
  • Propensity for action and change
  • Security and seniority (who is leaving, and why?)
  • Respect for the individual
Once you have a clear idea of what your particular culture is currently providing for your employees, you can begin to identify needed changes and develop strategies to meet your company’s goals.

Opportunities in theComing Decade

What can distributors do to be more successful in the future?

Be proactive and generous in rewarding your best employees - Don't fall into the pattern of only rewarding employees when you are about to lose them. This is one of the most common and destructive practices found in distributorships today. Spend more time figuring out how to reward your employees before they start looking around for better opportunities, or someone else offers them one!

Adopt a compensation system that is clearly understood and communicated openly - Don't assume because you are using a commission incentive program that it is actually working as an incentive. Employees must understand how the system works and believe that more efforts (sales, margins, etc) will actually earn them more dollars. If your employees don't believe they have any control over their pay based on their efforts - you don't have an incentive program.

Explore alternative work arrangements - This is one concept that has received more attention in human resource circles that almost any other. Alternative work arrangements are any scheduling pattern that deviates from the tradition 8 to 5 work week. Examples include flextime, compressed work weeks, job sharing, permanent part-time and telecommuting (very popular in the sales arena).

View training as an ongoing investment rather than an event - Training in progressive distributorships is no longer an event, the once or twice a year let's all pile up in a room for two to three days and get trained. It's now an ongoing process, designed to help employees meet the strategic goals of the company. Learning should never stop.

Handle discipline and dismissal carefully - Bad things sometimes happen in the best of companies. What differentiates the best is how the tough tasks are handled. Wrongful termination suits are increasing at an almost exponential rate - and juries often favor the dismissed employee. Take time to handle difficult situations carefully - and seek good advice when needed.

As you consider how to manage the new generation of employees, ask yourself, "Do I offer employees one of the best jobs in town?" If the answer is no, you need to identify what's missing and go about correcting it.

Remember: There is a supply and demand relationship for the best employees in town, and the top 20 percent of employees in any given market will always have a job. Your job is to make sure they are working for you!

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Article Categories:  Human Resources  »  Management