Engaging Employees

What makes a company a great place to work? Employees tend to give different answers to this question, but the US-based multinational Kimberly Clark seems to have hit upon a successful formula: 2012 is the third consecutive year it has been ranked the best company to work for in Latin America by the Great Place to Work Institute and it comes in ninth on the list of best multinational workplaces globally.

According to Ramiro Garcés, Kimberly Clark’s vice-president of human resources for Latin America, the main reason why people want to work for his company, which makes Huggies diapers and Kleenex tissues amongst other sanitary products, is that they feel “engaged”.

Garcés, who is originally from Colombia and works in Kimberly Clark’s head office in Atlanta, told AmCham members at a breakfast on May 9 that companies able to generate the “true commitment” of their employees will benefit from better financial results.

People, he said, should be the main drivers of business strategy. Kimberly Clark, which is present in 20 countries in Latin America including Chile, employs over 12,000 people in the region who Garcés described as the company’s “greatest asset”.

But how does a company engage its employees to create value? In Chile, this question is important given the increasing competition for skilled workers and the negative results of workplace satisfaction surveys across many industries.

The key, according to Garcés, is trust.

He quoted management guru Stephen Covey, who explained the idea in his book The Speed of Trust: “Financial success comes from success in the marketplace, and success in the marketplace comes from success in the workplace. The heart and soul of all of this is trust.”

Trust is built through credibility, fairness and respect, which combined with camaraderie and pride, make up what Garcés calls the “five pillars” of a Great Place to Work. As for managers, they should be good listeners and remember simple things like thanking employees for their efforts.

He also emphasized the importance of internal communication, which Kimberly Clark takes very seriously. For example, Garcés recalled asking his driver Pedro, who regularly picks him up from Lima’s airport to take him to his hotel, how Kimberly Clark is doing in Peru. To his surprise, Pedro knew all about the company’s new projects and financial performance.

“It doesn’t matter what your job is in a company, all employees should know what’s going on,” he said.

Engagement also brings important economic benefits for the company’s stakeholders. A survey by the Great Place to Work Institute from 1997 to 2010 showed that the 100 best companies to work for in the world obtained results that were three times higher than the Dow Jones and S&P 500 average.

Similar results have been observed in Latin America. Garcés noted that an improvement in the Great Place to Work Trust Index has been correlated to an increase in Kimberly Clark’s operating profits in at least two countries where it has a presence.

Beyond better financial results, engaged employees will also help strengthen the reputation of the company’s brands and drive innovation of products and services. But creating a successful corporate culture starts at the top and business leaders must “walk their talk” to keep employees motivated and inspired, said Garcés.

Other benefits of Kimberly Clark’s leadership in the Great Place to Work ranking, which is based on the results of an employee survey, include an increase in job applicants and recognition from its clients.

It all sounds good in theory, but why has Kimberly Clark’s success not been replicated by other companies in Chile? While Garcés did not address this in his presentation, it seems there is more to engaging employees than checking off items on a list.

Corporate culture is shaped by the attitudes and expectations of both managers and employees. Chilean managers tend to be more top-down in their approach, which may be part of the reason why some have difficulty earning the loyalty of their employees.

Another important factor is, of course, remuneration and benefits. A well-paid employee is much easier to “engage” than a poorly paid one.

Ultimately, there is no easily replicable formula for attracting and retaining the best people. Each company is unique with its own set of needs and corporate values, but there are things Chilean executives can learn from Kimberly Clark, such as the importance of establishing trust and facilitating communication.

As Garcés put it, anyone can copy his PowerPoint presentation, but actually putting its bullet points into practice is more difficult. “Dream big” Garcés urged those present at the breakfast, but – as Kimberly Clark has shown – your dreams must be built on solid foundations.

Julian Dowling is Editor of bUSiness CHILE