Why the Variable Workforce is Not a Passing Fad

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This post contains an excerpt from my whitepaper titled ‘The Variable Workforce Model – An Optimal Solution for Dealing with Field Service Uncertainties’

The freelance economy and variable workforce models have been gaining traction in a wide array of markets. Although the demand for this type of labor is growing, there are segments of the field-service industry that are concerned about whether or not individuals will continue to choose freelance work over full-time employment. We can answer this question by examining some factors affecting supply and demand. The first is the nature of work itself. The field-service industry, like many industries, has undergone a major shift in the way work is performed and by whom. This shift began in the late 1990s and early 2000s as the trend toward outsourcing forced many high tech companies (e.g., OEMs, resellers, integrators, etc.) to consider whether owning a field service force was strategic to their businesses. As a result, a number of companies began to outsource their field service activities.

The next major shift had to do with inversion of organizational hierarchies. In the past, span of control and layers of management were a proxy for expertise in the field-service industry. In other words, the larger the company, the more layers of management – and the more organizational controls in place, the better the service was perceived to be. Companies now realize that that large outsourcing providers are not only more costly do deal with but often do not possess the right level of technical expertise to complete the work accurately and in a timely manner. To overcome these deficiencies, companies that outsource or out-task field service now prefer to cut out the “middle man” and deal directly with individual expertise (e.g., freelancers) as needed.

A more recent shift that has made freelance work possible has to do with advances in communication and collaboration technology. These technologies make it easier for companies to do business with anyone, anywhere in the world without the need for large infrastructure or supervisory personnel. The Great Recession of the late 2000s also shifted the nature of work as many laid-off workers were able to generate income for themselves by taking on freelance assignments. This in has turn led to the emergence of the “Sharing Economy” also known as the “Gig Economy” where individuals are finding personal freedom and fulfillment from engaging in freelance work made possible through Freelancer Management System (FMS) platforms.

However, many economists wonder what will happen to the Gig Economy when economic growth improves and companies need to hire full-time employees. According to the U.S. Bureau of Labor Statistics over 34% of the U.S. labor force is performing freelance and independent contracting work. However, this number is likely to reach 40% by the end of this decade.

This trend is further supported by a market research study conducted by Field Nation, a leading FMS platform provider to the field-service industry. Their study reveals five (5) critical insights about individual preferences for freelance work. First, an overwhelming majority (88%) of respondents indicated that the freelance lifestyle is a personal choice for them. Second, almost three-quarters (73%) indicated that freelancing is their primary source of income. Third, over one-half (52%) view themselves as entrepreneurs and small business owners. Fourth, 93% of the respondents are committed to their clients’ success in addition to their own. Fifth, almost all (97%) are satisfied with what they do on a day-to-day basis, and 95% are either satisfied or very satisfied with their career choice as a freelance contractor. These stylistic facts suggest that the days of individual commitment to a single employer are long gone. The freelance economy is here to stay!

To learn more, download your FREE copy  today of my whitepaper titled  “The Variable Workforce Model – An Optimal Solution for dealing with Field Service Uncertainties”.

Understanding the DNA of Reverse Logistics

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A common expression among Reverse Logistics (RL) professionals is that nothing happens until a product is returned. To be more precise, nothing gets done without a Return Material Authorization (RMA). Anyone who has experienced a situation where a product just shows up on the receiving dock without an RMA knows what I am talking about. As such, the RMA process is one of the most critical elements in the management of the Reverse Logistics (RL) Supply Chain.

The RMA can be considered the DNA of the reverse logistics process because it provides all the critical information about where the product has been and the reason for its return. This information in turn provides guidance about what should happen next to the product once it has been returned. For example, should it be tested, repaired, or destroyed? It also provides information that enables the service provider to complete financial transactions related to the returns process such as warranty entitlement, adjudication, and reimbursement.

When designed correctly, the RMA function enables a manufacturer or service provider to obtain critical information required for processing the return (e.g., reason codes) and tracking labor and material costs associated with this return process. That’s why it is important for information captured in the RMA process to be linked to other corporate information systems such as their ERP, CRM, and WMS applications. Data gathered from the RMA can be analyzed to anticipate and forecast future returns. More importantly, it can be evaluated to determine the root cause of the returns. With this root cause information in hand, manufacturers can take steps to reduce returns by designing better products or improving the service delivery process (e.g., troubleshooting, remote support, etc.). In short, capturing and analyzing data about the return process will lead to reduced operating costs, enhanced service quality, and improved corporate profits.

The RMA is more than simply a transaction; it is a process that must be coordinated strategically. Indeed, products get returned for a variety of reasons at any time during the product lifecycle. By capturing the appropriate information about why the product is being returned, manufacturers and service providers can more efficiently manage back-end processes, for example by routing the returned product to the right point in the supply chain, whether it is a depot repair facility, asset recovery provider, or liquidation vendor. By anticipating returns, service providers can also take the appropriate action to ensure they have the necessary resources in place to process the returns and support the customer in a timely manner.

In summary, manufacturers and service providers are urged to place greater emphasis on the RMA when designing business processes and information system requirements related to the reverse logistics supply chain. This perspective can have a positive impact on identifying opportunities for improvement in productivity, profitability, and customer satisfaction. End-to-end integration of the RMA process and related transactions with other corporate information systems is a critical element to achieving this outcome.

5 Ideas to Successfully on-board Millennials

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This week’s blog post is from Dave Palmer. Dave is president of Incyte Strategies LLC, a consulting firm specializing in marketing strategy, brand awareness, sales growth and market expansion for technology, manufacturing, software, and professional services organizations. To learn more visit Dave at www.incytestrategies.com

As your youngest workers begin with your company, have you given thought as to how best to integrate them into your organization? Millennials, on the whole, do have a different way of perceiving themselves and their place in the world, Capitalizing, not complaining, about those differences will help you avoid costly turnover in the ranks of your youngest employees.

Below are 5 solid approaches to consider as you connect with and channel these new workers into your corporate culture and workflow. You’ll see an emphasis on inclusion, impact, communication, growth, and fulfillment. All things that matter to Millennials.

1. Think through and deliver a thoughtful, multi-day onboarding process. Invest up to the first two weeks, not just a few hours, introducing the new hire to the workings of the company (all departments), the processes and theories that go into efficient workflow and team collaboration, and the culture of your facility.

2. Consider providing the new hire with a mentor. Someone who will take a special interest in the person’s success and serve as a resource and “translator” for what’s happening at your organization.

NOTE: If you do this, you should also build a “How to Be an Effective Mentor” program. People with good intentions still need good training to mentor well.

3. Have programs in place that will combat the communication differences between the 25-year-olds and the 55-year-olds. The two groups will frustrate one another, though never meaning to. Here are a few of the perception challenges they’ll have of one another –

a. “Youngers” don’t want to “pay their dues”
b. “Olders” feel disrespected by a perceived lack of work ethic or attention to detail
c. “Youngers” want to “make a difference” right away
d. “Olders” prefer face-to-face communication, not texts

NOTE: You may want to hire an outside expert to help your team understand these communications differences and to help you build your program. You may even consider hiring this person to run the program quarterly. Ongoing training & progress monitoring is critical to ensuring these advances will take hold over the long run.

4. Once your new hires have been around, you’ll want to keep them engaged and not jumping ship in 9 months. Consider investing in job cross-training, production theory seminars, and going to school for various certifications. This generation is “self-centered” – they want to be happy, fulfilled, and do what they want. To keep them engaged, offer opportunities to grow.

5. Keep them informed of company plans, vision, milestones, quarterly progress, new initiatives, ideas being pondered – they want to know what’s happening or they feel cut off. Remember, this is the generation that believes they should be involved in EVERYTHING!

Whether you agree with their perspectives or not, it makes sense to acknowledge and deal with how Millennials think and what their perceptions are. That’s how you’ll best understand how to make them involved and productive members of your team.

Go Wide and Go Deep

Tips for beating your competition

Go deep - Go wide

Your service revenues have remained flat for the last three (3) years and nothing seems to move the needle on the revenue dial. You’ve stayed in touch with customers and provided them with all sorts of incentives to contract with you yet attachment rates have remained low. Why aren’t customers buying from you? Your field organization believes it because of competition. Others voices in your company think that your service organization is no match for the competition in terms of its capabilities. So why aren’t  you winning your share of business?

Let’s assume for a minute that your field organization is correct in asserting that competition is a threat to service revenue growth. How well do you really know your competition?  It is important to  answer this question in terms of direct and indirect competitors. A direct competitor is a company that offers the same primary services to the same customer base. In the OEM service world, this could be a Third Party Maintainer (TPM) or another OEM with multi-vendor service (MVS) capabilities. An indirect competitor is a company that offers the same or similar services as part of a wider service offering or that offers a good or service that can serve as a viable substitute. Depending on the industry, this may be a Systems Integrator, Consulting firm, Facilities Management, or Business Process Outsourcing Company.

Now that you know who your competitors are you can start to analyze how these companies compete with you. Once you do this you can develop a strategy to win back business. All too often, service providers especially OEMs think that competition is only on the basis of price. They believe that their competitors are under cutting them on price or giving service away for free. The knee jerk response is to play the quality card. In other words, the service provider who is losing market share makes the claim that the lower priced competitor provides inferior service and/or their work is more prone to defects because they are so cheap. For example, they may point to the level of training the techs receive (e.g., factory trained versus on the job training) or workmanship of spare parts (e.g., genuine versus generic). This tactic seldom works because it is difficult to back this up. Unless customers experience a defect in service, the argument carriers little weight in getting customers to switch.

The truth is that your customers will want to do business with you if you add more value than anyone else. Rather than compete on the basis of price or quality, you must find and exploit gaps in your competitors’ service capabilities or service portfolio. The ability to deliver a better, more comprehensive solution is often the true test of quality. A great example about how this works in action is the service division of a major manufacturer of Graphic Imaging technology that was experiencing intense competition from local TPMs. Rather than play the quality card; the service division analyzed the service portfolio and service delivery capabilities of their competitors. They learned their competitors where limited in terms of the geography they covered, their hours of operation, their response time, and parts availability levels.

This analysis led the service division to offer a far superior service portfolio in terms response time, coverage hours, and SLA compliance levels. More importantly, the service division had the systems and processes in place to ensure consistent delivery of these services; something that their local TPM competitors lacked. As a result, the service division was able to significantly increase service market share and improve contract attachment rates.

The takeaway here is that knowing who your competitors are and what they do well is not always obvious. You have to look broadly and deeply at the market. Broadly in terms of understanding both direct and indirect competitors and deeply in terms of how well they meet customer expectations.

Servitization and Revenue Maximization

The Basics That You Must Master

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One of the first consulting projects that I worked on was for Johnson Controls, Inc. (JCI). Our firm was brought in the mid-1980’s’ to help this company develop a service business strategy. A new strategy was required as result of the company’s decision to create one service organization to service all the building equipment sold by JCI. Up until this time, each equipment division operated its own service organization.

The new service organization was structured as a strategic line of business. The management team was given responsibility for generating and managing service revenue. Prior to the creation of the new line of business, the service organizations within JCI did not have to worry too much about revenue. Basically they had a captive market since the product divisions were responsible for selling service contracts and installation projects along with the products they sold. The new organization was now tasked with the responsibility of marketing and selling services directly to the end-users. This was an entirely new concept for the management team of the new business because they could now offer services to any company regardless of whether or not they owned JCI equipment.

The management team came to us for help with developing a go to market strategy and business plan. More specifically, they needed to become crystal clear with respect to their market, their service offering, and pricing approach if they were going to succeed in building a service business. One of their biggest challenges was determining the size of their market. It was foresighted of them to want to know about the size of their market because they’ve gone on to become one of the largest service organizations to the building industry, and certainly a company that is far along the path toward Servitization. I’ve met service executives who skip over this question about market size in their strategic planning process because they struggle with finding an answer. When asked if they know how large their market is, they give a vague answer likes “It’s big” or “the product market is X billion dollars so the service market is some portion of this”.

In order for the JCI executives to get a precise view of the size and growth of the market, we had to help them determine their total addressable market. This is where JCI’s foresightedness came into play. In defining the total addressable market, we helped JCI understand the market was not just equipment manufactured by JCI but equipment sold by other manufacturers. We also asked JCI to consider what else they could service in a building and what types of services they could offer. This led them to expanding their market focus to include a broad array of value-added services on a wide range of building technologies like fire and safety, security systems, and elevators. The definition did not stop there; it also took into account vertical market segmentation and other demographic factors like square footage and age of building.

As result of this strategic planning process, JCI had a comprehensive definition of their total addressable market (TAM). More importantly, they understood their service revenue opportunity on a very granular level; by technology, by service offering, and by vertical market. The work did not stop there. JCI still needed clarity around its Serviceable Available Market (SAM) and Serviceable Obtainable Market (SOM) or target market. In case you were wondering, SAM is the portion of the TAM that a company can reach taking into account various constraints like breadth of its sales channel and competitive factors. The SOM is the percentage of the SAM that a company can realistically capture based on various assumptions (e.g., sales effectiveness, operating capacity, resource allocations, etc.)

Without the diligence that went into defining the TAM, I don’t think that JCI would have grown into the service behemoth they are today. The level of diligence that went into defining the TAM established the foundation for the SAM and SOM. It also became the basis for them to eventually expand into service of Data Center, Energy Management System, and Security and Fire equipment. More importantly, JCI’s results proved that the more distinctions you can make about a market, the more precise your plans can be for penetrating it. The granularity around the TAM and SAM enabled JCI to ask the right strategic questions about what business they are in and what must happened in order for them to maximize market share.

The key takeaway here is that a service business must pay close attention to how it defines its market. It is not enough to simply say the market is “big” or reference market data from an industry analyst, and leave it at that. Companies who achieve outstanding results when it comes to service revenue growth are those who are able to methodically determine the size of their available, addressable, and obtainable market. This is absolutely critical for any company on the Servitization journey.

Innovate or Die

3 Strategies that will Transform your Service Business

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Recently someone asked me if service businesses face any fear when it comes to implementing new technologies or are they open to innovation. I had the think about this for minute and my answer is yes, they do face fear. Sure, a lot of business executives appreciate how important innovation is to the success of their company. However, few really step up and make change. Many more just talk about it or are forever planning to do it. This is fear rearing its ugly head.

Ridiculous you might say. Businesses are supposed to think rationally. How could a competent business let emotions get in the way? The answer is simple…businesses are run by people, people are only human, and fear is part of being human. In fact, business people have an uncanny way of expressing their fears as though they are rational objections. Here are just a few examples of typical objections that I have heard leaders give over then last twenty years for not adopting new technologies and the emotional sub-text (i.e., fear) about what they are really thinking:

Objection: Technology will not be able to do as good a job as me or my people
Fear: I will be replaced by a machine

Objection: Our Company is not ready for this new technology
Fear: People will resist my suggestion and I don’t want to risk my job over it

Objection: We tried something like this before and it didn’t work
Fear: I’ll be ridiculed for suggesting this idea. The last guy that tried to do this failed at it and lost his job.

Objection: This new technology is just hype. I can’t see it working for us.
Fear: I am really uncertain if we’ll be able to implement this effectively and don’t want to be the guy that failed, and lost his job because of it.

Objection: We can’t afford it. It’s not in the budget.
Fear: This could personally hurt me (us) financially this year (i.e. no bonus).

So what can leaders do to overcome their own fears? Tony Robbins, the great motivational speaker and self-help author offers three strategies:

1. Find something you are more scared of: Sure the fear of making a mistake about adopting new technology can be paralyzing but lost customers, increased operating costs, service inefficiencies and quality issues can be even more devastating.

2. Visualize what the future will be like: Imagine yourself and your company 3 or 5 years in the future. What will your future look like if you don’t make the change today? What impact will it have on market share, customer experience, or profits? If your answer is that things will be worse, much worse, then you will probably make the investment in the new technology.

3. Get Passionate about it: You can do this by defining all the reasons why you want to make a change and then make the change an absolute must.

Each one of these strategies has something in common. They require a leader to analyze their current situation and understand the implications of doing nothing versus the benefits of doing something. It also requires the leader have a well-defined plan for the future, and that he/she works diligently to carry out that plan. Remember that fear is acronym for False Evidence Appearing Real. Therefore the more supporting evidence you have that your plans are attainable, the more certain you will be at achieving it.

Let me know what you think of this post by sharing your comments below. If you believe you need more supporting evidence to pursue innovation in your service business then let’s schedule a FREE strategy session today. Last but not least, check out my new e-book titled “Unlocking value you within your service supply chain” for more suggestions on how to innovate and grow your service business.

Variable Workforce:

The New Field Service Paradigm

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The use of third party workers has become a common practice for Field Service Organizations. A driving force behind this trend is the economics of associated with managing a large pool of labor. Maintaining a field service workforce on a full-time basis represents a short-term, fixed cost for service providers. At issue, field service demand is variable in nature and becoming increasingly more volatile. This is occurring for a number of reasons including but not limited to the shift from reactive to proactive service, improvements in the ability of companies to resolve services issues remotely, cyclical events in the global economy, and technology changes (e.g., refreshes, consolidations, and upgrades).

One of the ways to deal with the peaks and valleys in field service demand is through a Variable Workforce (VWF) model. This type of model enables a field service provider to convert short-term fixed cost into a variable expense by utilizing third party workers. There are a number of options available to companies who want to implement VFW model. These include

1. Implement Master Service Agreement (MSA): with one or more companies: Under this scenario an OEM, ISOs or VAR, collectively referred to as the client, contracts with one or more field service organizations (FSOs) to provide on-site service as needed through a Master Service Agreement (MSA).

2. Manage subcontractors on their own: Another option is for a company to build its own variable workforce model. This requires that a company hire and on-board, independent contractors either directly or through a staffing company.

3. Turn toward a “Sharing Economy” model: Companies who are willing and able to manage teams of individual workers can turn to a sharing economy model. In this scenario, a company would use an Internet platform, also known as a Freelancer Management System (FMS), to recruit, on-board, train, dispatch, manage, and pay individual contractors.
The sharing economy model offers substantial cost savings to a company who is willing to pursue this course of action. Improvements in service quality and productivity are also possible as freelance contractors are typically more engaged and motivated since their income is directly proportional to the quality of work performed and number of assignments they accept.

The Freelance Management System Defined

According to the Staffing Industry Association (SIA), an FMS is a category of Workforce Management technology that enables self-management of a contingent workforce. To be considered an FMS, the technology most include the capability to 1) match freelance workers with assignments, 2)issue work orders, and 3)process payments to freelancers.

FMS solutions are available as either Enterprise systems or SaaS based solutions. At their core, they provide functionality to initiate, manage, complete, track, and evaluate work performed by freelancers. Additionally, they may include the ability to find and recruit freelancers through a marketplace functionality as well as additional services such as insurance coverage for freelance workers and the ability to manage work though mobile communications technology.

I recently authored a whitepaper, sponsored by Field Nation, titled “The Variable Workforce Model – An Optimal Solution for dealing with Field Service Uncertainties”. It discusses how FMS is creating improved outcomes for companies involved in field service. More specifically, it measures the benefits that can be achieved through an FMS platform and defines the key characteristics of an optimal solution. To learn more, download your FREE copy today.

Meeting Market Needs: An interview with Marne Martin, CEO of Service Power

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Last week, I conducted an interview with Marne Martin, CEO of Service Power, a leading provider of workforce management solutions. I was intrigued by recent developments in her company, most notably their release of Nexus FS, a new cloud-based software.   My interview with Marne provides some interesting insight on her company and her perspectives on the market for Field Service Automaton.

Michael R. Blumberg (MRB): Congratulations on Service Power’s progress. It looks like you are continuing to gain momentum in the market. Interim results for H12015 are very encouraging.

Marne Martin (MM): Thank you. Service Power is going through a revitalization campaign. We’ve concentrated on strengthening sales execution, managing our expenditures, making investments in new technology, and migrating to the Amazon web services platform. Our efforts are producing positive results that are the building blocks for the future.

Marne Martin 

MRB: Service Power is obviously gaining traction in the market with its core mobile workforce management software, including the patented ServiceScheduling route optimization software. Why release NexusFS™ (“Nexus”)?

MM: ServicePower’s feature rich ServiceScheduling and ServiceMobility solutions are great for the enterprise market where an enterprise might already have CRM, ERP, etc. already. Nexus FS ™ provides an easy to use, easy to implement solution for SMBs and enterprise customers who require field service management functionality separate from their existing CRM/ERP solution or simply a new all in one solution.

MRB: What perceptions existed in the market about ServicePower prior to launching NexusFS™?

MM: A criticism that we heard was that even though we had a well proven and robust scheduling, dispatch and claims products in terms of their features and functionalities, we were not prioritizing the user experience to be able to tailor UI views and information for the different types of users in an organization, as well as simplify integration challenges for customers. NexusFS™ gives customers a one size fits all solution through which we also have ready-made integrations to our other applications through our Restful API integration layer. It provides a full front-end solution that can be deployed all in one, or on a modular basis to fill gaps in a technology portfolio.

MRB: Obviously you’ve done your homework. How did you validate your assumptions regarding market wants and needs for the NexusFS™ application?

MM: Like many vendors, we relied on competitive market research to better understand our market position and opportunity. I also brought in people with alternative perspectives to validate our assumptions and test our conclusions. It is always my belief that teams of high performing individuals are the ones that create great companies and technologies.

MRB: What resistance did you get from the shareholders in your company when you told them of your plans to release NexusFS™?

MM: I presented shareholders in fall 2013 with a three year plan. It required that we focus on people, process, product first – and then profits, although we of course did commit to managing tightly expenses. This has required us to prioritize and make choices, to focus on efficiency and output internally, and we have been able to drive clear progress in all four areas as you can see from the interim results recently released. Shareholders weren’t certain back in 2013, and even in 2014, we would be able to bring out new products using internal talent and funding, but we have been able to accelerate our output migrating to a fully agile process and using small internal dev teams like “skunkworks” teams. Certainly there are some shareholders that desire us to focus only on profits and not invest in technology, but what creates a new trajectory for the company is the investment in products and marketing first, and then of course sales execution on an increasingly larger scale thereafter. 

MRB: What makes you think the is sustainable?

MM: Investors want to invest in sensible things and are happy to put cash into companies that are prepared to grow steadily and deliver a return on investment.   We have proven our ability to make the investments in our products, generate new cutting edge technology, so the next step is to add scale through our direct efforts, as well as do more in partner enablement related to indirect channels. This is all related to being able to deliver investors consistent topline growth linked to bottom line profitability, which is what they want. We must therefore show investors not just strategic results but also share tactical execution feedback with them metrics and progress, which we are doing. Examples of these touchpoints include getting NexusFS™ to market, managing the internal cost of development, migrating to the cloud and therefore more efficient IT and support structures, increasing the penetration and footprint of our existing applications, building out our professional services capabilities, and of course implementing new logos.

MRB: Thank you Marne, we look forward to learning about ServicePower’s continued success in the market.

A framework for a creating a Performance Driven Company

Two weeks ago I had the good fortune of attending a Service Industry Association Roundtable. These roundtables are held every couple of months and they are typically hosted by a member firm. This particular roundtable was held in Grand Rapids, MI and hosted by Service Express, Inc. (SEI). One of the highlights of the event was a presentation delivered by Ron Alvesteffer, SEI’s CEO.

SEI provides Data Center Hardware Maintenance and has been growing by leaps and bounds over the past ten (10) years. The company has recently been acquired by the Pamlico Capital, a Private Equity firm focused on the Lower Middle Market. Ron’s presentation offered insight into the tremendous growth the company has experienced and will continue to experience under his leadership.

It is not just their financial performance that makes them a great company. It’s the culture and values of the company that make it a great place to work. Indeed, SEI is a proud winner of the “101 Best and Brightest Companies to Work For” in West Michigan, Chicago, and Metropolitan Detroit each year since 2005. The company was also named on of the  “101 Best and Brightest companies to Work For in the Nation” in 2011 and 2012. Inc. magazine  named them to their “Inc. 5,000 List of America’s Fastest-Growing Privately Held Companies”, an honor they have held since 2007

A great deal of the company’s success is due to Ron and his management team’s ability to build a performance driven organization. This strategy has enabled the company to grow through a combination of geographic expansion and new product/service development. The management team diligently follows a process centered business model that Ron developed. The model involves managing each business function, department, and line of business like a franchise. More specifically, the model is comprised of these four (4) building blocks:

  1. Vision: Ron refers to this as his “why”. Indeed, having a strong “why” is the basis for all successful endeavors. In essence, you need to have a compelling reason why you want to achieve any goal if you are ever going to achieve it. The reason why SEI exists is to “work with employees to help them achieve their personnel, professional, and financial goals”.
  2. Core Objectives: SEI has four core objectives these are 1) employee engagement, 2) excellent customer service, 3) margin retention and growth, and 4) revenue growth. These core objectives answer the question “how”, how does SEI achieve its vision.
  3. SR5 Performance Measurement: This is a performance measurement system that SEI utilizes to track results. Although, “SR5” sounds a little complicated, it’s really quite simple. It stands for Scorecards, ROIs, and 5/15s. In case you are wondering, scorecards are used to track goal achievement at a company, department and regional level. ROI stands for responsibilities, objectives and indicators. The 5/15 is a personal development plan created by each employee. (It originally got its name from the fact that it takes five minutes to read and 15 to prepare.) The SR5 system helps SEI personnel see trends and avoid emotional reactions to movements in company performance. As a result, management and employees view their performance objectively rather than emotionally.
  4. Business Focus: As mentioned above, SEI’s business focus is on Data Center Hardware Maintenance for mission critical servers. Ron’s perspective is the business focus answers the question “what”, what is it that we do here at SEI? Ron also believes that while this question is important, it is less important than the other three building blocks mentioned above. This makes a lot of sense, don’t you think? It often doesn’t matter what a company does as long as they have clear vision, core objectives, and an effective measurement system in place.

These building blocks serve as a great framework for how to build a thriving, performance driven company with high levels of employee engagement and morale. In addition to the awards and accolades that SEI has received for being a great place to work, the company has experienced an average revenue growth rate of 20% over for the last 10 years.   Ron refers to this framework as the “SEI Way”. You can download a copy of the free e-book that explains the concepts in more detail by visiting Ron’s blog site. http://ronalvesteffer.com/theseiway/