Employees – Expense or Asset?

15 November 2013

Your biggest expense walks in and out of your business each day. Or are they your greatest asset?

Employees – Expense or Asset?

With any other asset in use in the business, management would ensure that they were maintained properly and controlled effectively in order to generate revenue. People are no different, and it is vital that they are “maintained” regularly to ensure that they deliver their optimal performance.

So what happens in practice?

In some businesses, managers view the appraisal process as an imposition from the Head Office, and in many instances the process is either not carried out effectively or not done at all. On the other side of the table, where appraisals are linked to pay reviews, many employees aren’t really paying attention to the discussion until the point where the grading or salary discussion takes place. Both of these situations are morally bankrupt, and as a minimum, it is important to decouple any financial discussion from a development plan and to ensure that the management take appraisals seriously.

Personal Growth Plans are an effective way to ensure that this happens.

The Coachworks Personal Growth Plan provides an effective framework for the personal growth of leaders and their teams and it allows the individual and business to chart their progress towards growth and success throughout a 12 month period.

Client Thurlow Nunn has used the Coachworks Personal Growth Plan template consistently for the past 6 years. Between 2006 and 2012, Group turnover has grown from £95m to £136m, and throughout this period, profits have risen from £691k to £1.5m, with profit per employee rising from £1,584 to £3,205.

Thurlow Nunn Director Simon Grylls said “Showing commitment to your people in this way is really effective, and we continue to do it every quarter; simply because it works.”

Having grown and developed its human capital, the group is now expanding with a multi-million pound investment in Milton Keynes which is outside of its traditional market.

Effective PGPs contribute significantly to the successful growth of a business. Using an appraisal process in order to keep the HR department off your back is not an appropriate way to treat your most valuable assets!

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