HPS Leadership Best Practices Journal™

Discretionary Employee Contribution™: Leveraging 100% from Your Employees

Have you ever considered your employees as being paid volunteers? Think about it for a moment. Regardless of their roles, your employees continuously exercise voluntary discretion throughout the course of the day. And their discretion and related behaviors may or may not reflect 100% of their fullest potential contribution.

For purposes of this article, we use the term discretion in the context of employee contribution to desired business results.

Discretionary Employee Contribution™ and corresponding behaviors are driven by some form of stimulus. While leaders do not and cannot influence all stimuli, exemplary leaders model appropriate leadership behaviors and, as a result, inspire the best (discretionary contributions) from their people.

Consider the following analogy as another form of discretionary contribution. Customers exercise discretion when deciding to use a particular product or service based on a variety or reasons. Research studies confirm that customer discretion is significantly influenced by emotions. A positive customer experience, based on positive stimuli, will influence discretion in the future and will affect the continued patronage of a product or service.

A recent research study on customer behavior suggested that 75 percent of the primary reasons customers no longer continue business with a particular company can be summarized as, "I didn't like the human side of doing business with this particular product or service provider."

A simple translation might be that satisfied customers are much more likely to continue using your product or service versus exercising discretion to consider the competition. Furthermore, it is far less expensive to retain valued customers than to replace them. Professor John Daly, Ph.D., The University of Texas at Austin, once stated, "When you make a mistake with a customer always, always, overcompensate." Now, that is both sage advice and common sense.

So how does this relate to Discretionary Employee Contribution™? Exemplary leaders inspire the best from their people. Inspired employees then exercise discretionary behavior and put forth their best contribution to product quality, service delivery, and ultimately customer satisfaction. It seems logical that fostering the highest levels of potential Discretionary Employee Contribution™ then constitutes a leadership best practice. By the way, "inspiring the best from your people" also creates a unique form of competitive business advantage. Based on resource constraints (e.g. time, money, capital, headcount) in most organizations today, "inspiring the best from your people" is yet another demonstration of exemplary leadership effectiveness.

In the final analysis, leaders who inspire the best and foster the highest potential from individual contributors and their teams and organizations will get more traction and improved bottom-line business results.

The following articles, published earlier this year, may be of interest to you in relation to Discretionary Employee Contribution™:

• Customer Satisfaction: Norm vs. Anomaly
• Exceptional Customer Service Creates Unique Competitive Advantage