small business adviser | by jerry bartlett

People as the Competitive Advantage

Given the tight labor market today, companies must create the kind of corporate environment - culture, if you will - in which its employees actually like to work. This takes no small amount of effort.

Core values

The idea of challenging and inspiring the best people is the kind of guiding principle that provides a foundation for all that a successful company does.

I also believe every person in a company is crucial to its success. That's why each employee ought to be treated as a valued individual. When you walk in a company's door, you should be able to sense its unique spirit. That sprit should be apparent in the employees' smiles and in their friendly greetings. Ideally, the people at a company, no matter its size, should genuinely care about each other. This philosophy should start at the top, and if it's working, its effect on the corporate culture can be readily calculated in the turnover rate. Compare your rate to the industry norm and see how well you're doing. It may be time for a change.

Rewards and recognition

Many successful companies have a tradition and philosophy of sharing with employees who help the company achieve significant results. A company should ask its people to do their personal best and continually improve their skills. In return, the company should recognize and reward their performance.

For instance, in our company, we have a company recognition program based on our Guiding Principles. Every employee has an opportunity to be involved by nominating other employees for an award. The program culminates with our annual company-wide ceremony with our sites satellite-connected.

And regardless of job level, every employee should have the opportunity to earn a bonus tied to individual and company performance. If the company experiences outstanding financial success, so should the employees. The company might also share its success through competitive wages and celebrations recognizing company milestones.

Focus on the individual

A good company is committed to helping its people grow. There are many ways to accomplish this. A tuition reimbursement program is a good place to start. Additionally, a performance planning process can ensure that each employee's goals are tied to the company's business initiatives. Another morale-building strategy is to fill as many job openings as possible through internal promotions.

Providing employees with work/life balance and flexibility ought to be another company priority. It is becoming progressively easier to work at home, which can be beneficial to the company and attractive for the employees.

Unique benefits

Successful companies offer a benefits package especially tailored to the needs of the employees and the desire to retain them. The benefits of our company may or may not be appropriate as a model for yours, but they will give you a good sense of what the market is expecting:

• Retirement Plan - If a participant contributes the full 8% allowable, the company annually has added 15%, for a total of 23% of base pay going into retirement savings.

• Tuition Reimbursement Program - We pay 100% up front when employees enroll in college classes that pertain to our industry. And we pay 75% for any college class, regardless of subject.

• LifeCycle Account - Employees can be reimbursed up to $150 annually for personal development and health-related expenses - from breast pumps to financial planning services to music classes.

The competitive advantage of most successful companies is its people. A company that challenges and inspires the best people and provides an environment that makes it a great place to work has a great base from which to work.

In the end, it comes down to how a company lives its vision, values and principles every day. The benefits, compensation, bonuses, etc. are important and nice, but from a retention standpoint, they're just icing on the cake.

Jerry Bartlett is chief people officer at American Century Investments which was this year named to FORTUNE magazine's 100 Best Companies to Work For. Contact him at 816.340.4907.