In 1960, Douglas McGregor at MIT’s Sloan School of Business formulated the Theory X and Y management structures. According to Theory X, workers inherently dislike their jobs. People must be coerced, controlled, or punished to accomplish their tasks. It’s all about the money. Sound familiar?
Theory Y, conversely, states people are actually motivated by higher achievements. Workers seek responsibility and can feel fulfilled by their work beyond their paycheck. In this mindset, everyone has a unique contribution to the team and company, if only their interests can be aligned with their work.
Our first year of operation at Impact Enterprises felt like a Theory X environment. We had launched a completely new type of company with nothing to guide our way. Employees daily were concerned with their pay target. Managers were commending or penalizing performance only through bonuses, which brought down overall morale. We were pushing our way day to day through the work without seeing the bigger picture.
Even though projects were being accomplished, we were in a rut. This wasn’t the company we sought to establish.
At the end of 2014, we conducted anonymous surveys with all of our employees to gauge their job satisfaction, goals, and achievements. The results were both encouraging and poignant. 84% of employees said they had gained new skills, while 92% said their experience will help them get a new job in the future.
Conversely, the general sentiment was Impact Enterprises was not providing them opportunities to advance. For 57% of them, this was their first job and they expressed a new sense of responsibility thanks to being employed. Our Data Specialists were hungry to improve themselves and we simply were failing them.
We immediately set off to launch a comprehensive curriculum of workshops to develop our employees beyond their daily tasks. Thanks to the help of a diverse group of advisors, we devised an ongoing internal program focused on 5 modules: management skills, personal wellbeing, career planning, self-assessment, and community engagement.
The workshops cover myriad topics, ranging from communication skills to conflict resolution, stress management to personal motivation, health and wellness to goal setting. Employees study their Myers Briggs personality type to become self-aware of their core strengths and weaknesses. Local business leaders give talks about their success stories. Through the process, employees will gain a better understanding of their capacities in a way they never considered before.
All this follows in the spirit that every employee, given the right guidance, can contribute to the greater team. Henry Ford realized the value of investing in employees when he introduced the $5, 8 hour work day in 1914. Up until that point, his factory was hiring 300 employees a year for 100 spots on the production line. Turnover was costing the company a fortune. By doubling the daily wage and shortening the hours, employees no longer were an expendable good. He broke through the “dark clouds of the present industrial depression” by proving his commitment to his workers.
Employee engagement rings just as true today. From 1998-2005, the average stock price of Fortune’s ‘100 Best Companies to Work For’ rose 14% per year, compared to 6% for the overall market. The bottom line is, employee engagement works.
Supporting our employees is especially necessary in Africa, where high unemployment means an unlimited supply of labor. The typical contract for a young graduate in Zambia is 6-12 months, allowing for an employer to avoid paying benefits while ensuring cheap salaries. For a low-skill company like a grocery store, this might not be harmful, but for a high-skill digital service company like Impact Enterprises, ensuring the quality and sustainability of our employees is critical.
As McGregor stated, a successful company cannot thrive without adopting a Theory Y mindset of management. Developing our employees ensures they better align their skills, lowers turnover, and improves overall productivity.
Furthermore, we are demonstrating to our community and the region at large that establishing an employee-focused service company is an incredibly positive business model. We expect our employees to go on to bigger and better career opportunities and we want their time at Impact Enterprises to serve as a beacon of inspiration for their future endeavors. We have no doubt that many will become leaders in their workplaces, families, and this country. Giving them every opportunity to learn and grow is how Impact Enterprises is providing valuable employment to these Zambian youth.