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How to Run a Company

by Miki Saxon

Enviable stats: 2006 revenues 1.9 billion; 31 years of consecutive revenue growth; no debt; 10,087 employees worldwide; 4% turnover.

According to Jim Goodnight, founder, president and CEO of SAS International, the world’s largest privately owned software company, ‘Employees don’t leave companies, they leave managers… More than anything else, you want to create an environment where people are respected-and treated like they’ll make a difference… I think the success of the company has been, to a large degree, due to the benefits we provide because it has made our people very happy, to want to stay on… My philosophy has always been: You either spend money on your employees, or you spend the same amount of money on headhunters, recruiters, on training, on lost-productivity.’

No doubt about it, Goodnight has great MAP, but it’s doubtful that Wall Street will ever learn the lesson and adopt his philosophy. However, you can—even without being able to fund the same benefits.

Start by really respecting all your people. I know too many managers who only respect their ‘stars’ and then wonder why turnover is rampant in the rest of the organization.

Provide as much tangible proof as possible that you value your workers, from health care to chocolate, but don’t kid them that the company can’t afford something that is obviously feasible. You’re people aren’t stupid, they know the score, and if you want to build trust then tell them the truth.

No matter how great, those benefits don’t give you the right to disrespect them. It’s not a tradeoff—you don’t get to micromanage, insult, play favorites, or bully your people just because the company offers health insurance.

Things you can do

  • Check out turnover rates in your industry, compute your own—whether for your company or just your group—set a reasonable improvement target, then work to achieve it.
  • Evaluate your MAP by talking to your people and really listening—even when you don’t like what you’re hearing—and work on changing it.
  • Find out what else you can change/offer that would make a difference; do as many as you can and be honest about why you can’t.
  • As the song says, ‘little things mean a lot…,’ so add as many small gestures as possible to show your appreciation.

The bottom line—if you treat your people as replaceable don’t be surprised when you have the opportunity to do so.

One Response to “How to Run a Company”
  1. MAPping Company Success Says:

    […] following SAS since it was a segment on 60 minutes nearly 10 years ago and recently wrote about it here. The latest accolade comes from Scott McArthur in the UK, citing an article in The […]

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