Problem: Three years ago, Beam Inc. underwent a change in command that prompted the spirits producer to re-evaluate company practices for successful performance management and action planning.
Solution: Beam made employee engagement a top priority and — with the help of new performance management technology — has experienced more effective managerial leadership and a positive impact on the bottom line.
Beam Inc. President and CEO Matt Shattock said the premium spirits producer’s overall success will stem chiefly from employee engagement levels. With this as the company’s No. 1 priority, Beam’s human resources department implemented new technology to facilitate communication and teamwork.
In 2009, Beam employees were introduced to Taleo talent management software, and Kenexa software was used to track progress through surveys. Since then, Beam has experienced jumps in sales that it attributes to successful engagement programs. In the past year, Beam has changed the way its employees and managers communicate, and seen a marked uptick in performance as a result of new engagement initiatives.
When Shattock took over as Beam president and CEO in March 2009, he introduced the idea of employee-driven company performance. “His view was people and brands,” said Angela Howard, global human resources organizational development specialist. “He wanted to make [employee engagement] a focus for every individual.” By investing in its people, Beam could make engagement a prominent business driver and improve its overall performance. A more engaged workforce could mean consistently higher productivity and greater bottom-line returns.
However, the company’s progress report showed missing links between managers and employees that prevented talent leaders from engaging Beam’s 3,200 employees worldwide. Communication between leaders and their teams was stilted and inconsistent, leaving many workers without a clear sense of direction.
Beam’s human resources department stepped in with a new performance management plan, implementing talent management software and employee surveys to facilitate goal setting, performance reviews and progress tracking that would bridge the gaps between workers and managers and boost engagement to a new level.
Shattock’s vision of engaged and empowered employees depends on the company’s ability to reach every one of its members. “Everybody should be working to push employee engagement — in yourself and in others if you’re managing a team,” Howard said of Shattock’s philosophy. “We are trying to unleash performance in all of our employees.”
This goal relies heavily on active supervision and strong lines of communication from the top down. Proactive managers play a huge role in facilitating these steps. Among their responsibilities as supervisors is the task of engaging each employee on a personal level.
“All organizations are kind of doing the same thing: moving from management to leadership,” Howard said. To make people the driving force behind company success, Beam needed to promote a management regime centered on person-to-person interaction. Engagement initiatives were all about starting conversations between employees and leaders and keeping them closely connected. Maintaining this network, however, would require tools that Beam didn’t have at the time.
Without the right technology, Beam’s performance management system was suffering. “In the past, we hadn’t equipped our managers with the tools and the resources to action plan at a work group level,” said Sue Gannon, Beam’s vice president of talent, culture and organization development. Formerly, goal setting and action planning were conducted manually and on paper. With documents piling up and rigid procedures in place, each individual’s progress was difficult to note and even harder to monitor.
“We were finding that people were not goal setting; they were not having structured conversations with their managers to help understand what their expectations and goals were for the year,” Howard said. “Self-assessments weren’t happening around the world; only in pockets of the business.”
Beam needed a uniform performance management method and an apparatus to ease the process of collecting and accessing information. To create this, the company reached out to people with the equipment and know-how.
Performance management technology added much-needed structure to the company’s goal setting and action planning process. “In 2011, we were really rigorous about providing robust tools and resources for managers and ensuring that everybody understood this abstract construct of engagement,” Howard said.
Those tools and their associated programs — implemented at the end of 2010 — digitized employee reviews and allowed managers to track and survey each individual throughout the company with relative ease.
Taleo provided an online talent management program to regulate goal setting, mid-year and end-of-the-year performance reviews and development planning. Employees continue to contribute their goals to the platform to ensure they are aligned with company plans.
Kenexa distributed surveys that managers can use to help track progress and engagement levels. These surveys generally led to more targeted goals and aggressive action plans following the regular manager-employee conversations prompted by the new performance management system.
The two programs work in tandem to keep leaders and their teams connected while pushing engagement, goal setting and performance to higher levels. The first mass survey, conducted in mid-2011, showed growth from company numbers in 2009 and paved the way for more progress this year.
Turning Plans Into Actions
According to Howard, action planning is only 10 percent of the process. “The other 90 percent is actually taking action,” she said. The performance management and survey tools put employees and managers on the same page. From there, HR can review the information collected, work toward objectives and amp up overall performance.
Beam communicates the survey results from the top down. The process begins with a conversation with the CEO, during which three to four key objectives are identified as points of improvement for the entire organization. Similar conversations are conducted with the senior vice president of human resources and with senior leaders later. After that, the executives are responsible for translating the objectives to the regions and locations they oversee until all of Beam’s employees are in the loop.
During this process, engagement likely will surge through the entire company and draw a thread through the organization from top to bottom, aligning goals and motivating all the ranks. The collective revamp boosted employee achievement, and the proof is in greater returns.
With participation rates in the employee engagement survey consistently more than 90 percent, the changes’ impact was tangible. Within the first month of launching the goal-setting tool in 2010, 75 percent of employees had contributed goals to the system, and 87 percent agreed that the new process helped align their goals with corporate priorities.
Company-wide participation paid off; engagement scores went up 3 percent from 2009 to 2011, and market performance experienced similar growth. Since the implementation of these engagement initiatives, coupled with the company’s strategic growth initiatives, including several acquisitions, Beam has seen an 8 percent increase in comparable sales from 2010 to 2011.
In 2011, Beam became a public company, and its stock price has increased more than 40 percent on the New York Stock Exchange. The company’s human resources executives attribute this progress to their focus on employee engagement and performance management.
Reflections and the Road Ahead
The path to success wasn’t all smooth. Change management specialists such as Howard had to maneuver through unfamiliar software and old ways of thinking. Implementing new technology and procedures meant going against the norm and could result in discomfort and misconceptions.
She said communication is imperative to the success of new initiatives. “You have to make sure you have all the pieces of change management — communication, training, etc. — in place before you start rolling things out.” If not, employees may not adapt to the new structure as easily.
“There’s a lot that happens when you implement a tool or process. Rumors begin. We had to bust all the myths out there,” Howard said.
For example, some new users of the goal setting technology mistakenly believed that once goals were entered into the system they could not be changed. As a result employees were hesitant to input their goals, which threw a wrench into participation.
“It’s been a learning process. Knowing now what those myths are, we can implement communication to make sure people didn’t gravitate towards believing them,” Gannon said.
Beam also had to figure out how to introduce engagement as a mindset, not a new project. While laying the groundwork for these new initiatives, maintaining a balance between integrating structure and culture was key.
“In our first year implementing Taleo, our focus was on getting the process done and getting people acclimated to the system; it was a huge change management effort. This year is about instilling the spirit behind what we are doing,” Howard said.
Engagement is not just a score; it’s a feeling that can drive the company. Beam’s initiatives were not meant merely to shape company policy, but to introduce a new way of doing business every day.
“The spirit behind this is creating conversations with employees and managers, setting expectations, and instilling personal and professional development as an ongoing behavior versus something ‘I just have to get done,’” Gannon said.
An engagement culture can propel a company to new heights, and just two years into its new engagement program Beam is reaping the benefits.
Mohini Kundu was an intern at Talent Management magazine. Send comments or questions to email@example.com.