Whither ‘Employee Suggestion Schemes’?

• It was good to read Harry Wallop’s article in The Times entitled ‘Workers are better placed than bosses to improve productivity’
• He cited a person working at the Ministry of Defence saying: “If management would listen to me, we could improve antiquated processes and procedures”
• Harry followed this up by noting that: “Some companies run employee suggestion schemes” and quoting impressive examples of companies that have made good use of them viz:
  • Dow Chemicals – Seek ideas to save money and energy by promising to implement those that cost no more than $200,000 and can pay for themselves within a year – over a decade Dow has bet on 575 ideas and saved the company an average of $110 million a year
  • Marks & Spencer – Led to popular ideas such as braille greeting cards for partially sighted customers
  • British Airways – Cut the airline’s fuel bill by £600,000 a year
•  Harry may well have been reading our book ‘Productivity Knowhow Revisited’ where we devote a whole section to the subject of CI – ‘Continuous Improvement’ – which highlights the enormous potential for productivity improvement that’s simply ignored by most organisations, public and private 
• Relevant extracts follow:

• Many good improvement ideas already exist ‘in-house’ in the heads of employees but most western organisations still don’t recognise or fully exploit this
• CI asks employees for a steady stream of random performance improvement ideas
• Canon and Komatsu once boasted it was because they asked their workers for ideas that they had done so well
• So how to trawl for employees’ ideas?

• EMPLOYEE SUGGESTION SCHEMES:
• Management must first recognise that, if someone takes the trouble to put forward an idea for improvement, someone with clout should take the trouble to treat it seriously and respond
• Hence, such schemes require formal collection, vetting, storage, implementation, reward and publicity systems
• And they rely on people being motivated to offer their ideas, not least by expecting a share in any gains
• To maximise your trawl of employee ideas over the longer term, guidelines are:
  • Appoint a director to be in charge of the scheme – his/ her role is to scour the organisation for all good ideas, store and reference them all, and make sure something is done with every one – someone at that level has the broad view needed
  • Make it easy for employees to contribute – some organisations create a safe platform on the internet whereby any employee can log on and put forward suggestions – just make sure their name is attached
  • Respond quickly to any idea, no matter how silly it may seem, by first acknowledging its receipt and, soon after, explaining the decision on it – delays of a month or more will kill any enthusiasm for the scheme
  • Authorise action asap – don’t allow any idea to be lost in bureaucracy
  • Don’t waste time requiring presentations – they frighten many people and make new ideas seem special, which they should not be
  • Let people implement their ideas their way, if possible – tight control stifles initiative, energy and creativity – provide all the support and resources needed – employees love seeing their ideas being used
  • Reward best ideas handsomely – use wide and regular public recognition as well as cash and promotions – just don’t relate any cash to savings anticipated which can lead to major arguments

• POTENTIAL BENEFITS:
• If and when thousands of ideas for incremental improvements are generated, the cumulative gain from using many of them can be enormous
• And without incurring the same costs, risks and work disruption associated with any ‘quantum leap’ project
• Nota Bene:

                        1,000  x  0.1% improvements    >>>    1  x 20%

• IMPORTANT QUOTES:
• Eiji Toyoda, when Chairman of Toyota: “Our workers generate some 1.5 million suggestions a year, and 95% of them are put to practical use
• John Harvey Jones, when CEO of  ICI: “The humble worker can often see a solution before the manager has noticed the problem”
• Justin King, when CEO of Sainsbury’s: “It’s not fear of retribution that stops people speaking up – it’s futility – the belief that it will not be acted upon”