Management Rules that Make No Sense #10: I Saved My Company $25K/Month And All I Got Was This Lousy T-Shirt

It wasn’t a t-shirt. But, it might as well have been.

How would you reward an employee who figured out a way to save your company $300,000 per year?

Now, what if the employee wasn’t tasked with saving the company money? What if he was working in your shipping department and just thought it up?

And if your employee were making $35,000 per year? Now, how would you reward him?

I’m guessing you would be more generous than WordPerfect was. Don’t get me wrong, I loved working for WordPerfect, but this story was not their best day.

The year was 1990. WordPerfect was at the top of their game. Part of the reason was that support was free. In fact, if WordPerfect had released an update and it fixed your problem, they would send you a new set of disks free. This was before the internet. You couldn’t just go online and download software. You had to call the company and have them send you floppy disks. WordPerfect sent a LOT of floppy disks out. They had their own disk manufacturing department. Every day hundreds and thousands of packages would be shipped out. And WordPerfect was picking up the shipping costs on each one.

An employee in their shipping department got to thinking about all those disks. His job was to put disks in boxes. All day long he watched boxes go by destined for locations all over the world.

That got him to thinking. And with a little bit of research he figured out how WordPerfect could reduce their shipping costs. . .by A LOT. I never heard what his suggestion was, but I’m guessing it was to sort the packages by zip code before handing them to the post office. Whatever the change was it cost the company nothing and it saved the company $25,000 PER MONTH.

That was nearly what the guys in the shipping department made in a year.

You would think the company would be grateful. They were. You would think they would find an appropriate way to show their appreciation. They didn’t.

Two gift certificates for dinner at The Tree Room, a fancy restaurant owned by Robert Redford and located up Provo Canyon. In hindsight, he might have preferred the t-shirt.

Now, maybe you’re saying, the company had no obligation to give him anything. He should be grateful for a free dinner.

You would be correct, and I have no idea if he enjoyed the dinner. Because I never heard that part of the story.

But, here’s the problem for WordPerfect, and any other company that is tempted to pawn off compensation vastly out of proportion with the savings. All of us at the company heard the story.

Do you want your employees to look for ways to save you money? Do you want employees who are interested in maybe stepping outside their comfort zones to find a better way of doing something?

Of course you do. All businesses do. Think about WordPerfect. How excited do you think the rest of the employees were to find innovative ways to save the company money?

We weren’t. In fact, even 25 years later the story still bothers me. That $25K / month was free money. Imagine if the company had awarded the employee their first month’s worth of savings? NOW, how motivated do you think other employees would be to find ways to save the company money? We’d be spending our free time looking for ways to help the company. Instead we were all left with a feeling that the company was kind of cheap. Like a guy who leaves a $2 tip on a $50 meal.

Compare that true story to this story which probably isn’t true, but still makes a valid point.

Carl went to work for a large company. It was his first job out of college and he was excited to finally be in a “real job.” On his first day his manager introduced him to all his coworkers except one. He noticed that he wasn’t introduced to Bob. Figuring that Bob was tied up on another project, he ignored it.

Carl loved his job. Every morning when he came to work he had to walk past Bob’s office. He started to notice that every time he walked past Bob was staring out the window. And come to think of it, he never saw any emails from Bob. Bob never appeared at any of the project or team meetings. It became a mystery as he tried to figure out what Bob’s role was. After a month he finally admitted defeat. He had no idea what Bob did for the company. In fact, from his view Bob did nothing.

Finally Carl went to his boss.

What’s the deal with Bob?

What do you mean?

Well, he’s never in meetings. He never sends email. Everytime I walk past his office he’s just sitting there staring out the window.

Yeah, about that. See, last year Bob came up with an idea that made the company $10,000,000. . . and we really hope he comes up with another one.

If you want your employees to look for ways to help the company in addition to doing their jobs, don’t be cheap when it comes times to share the benefits of their ideas.

You can’t afford to be cheap.

Rodney M Bliss is an author, columnist and IT Consultant. He lives in Pleasant Grove, UT with his lovely wife and thirteen children.

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