The Top 9 Mistakes ESOP Committees Make (and How to Avoid Them)
By Kellee Kroll, Consultant at the Principal Financial Group®
I hear from many companies that they have an ESOP committee, but it has gone stale and lost its momentum. Company leaders wonder what they can do to get the committee motivated again. In my experience, there are 9 common reasons committees fail. Instead of trying to fix something that has broken, let's look at these common reasons and find out how to avoid them before they occur.
Since I grew up in Wisconsin and do like a good piece of cheese, I'm using a cheese analogy for this "top 9" list. Also, since Wisconsin claims four of the top 100 of America's largest majority-owned ESOP companies , I think the analogy fits.
- Seal Of Approval
If your committee doesn't have support from leadership, stop right now and consider where this lack of approval may lead. The committee's efforts can only be as effective as the leadership's willingness to support the committee's activities.
- All Shapes & Sizes
Be sure to get a mix of employees on your committee to represent your workforce.
- The Right Ingredients
Following a "recipe" will help ensure the right structure to contribute to a committee's success. To create a solid foundation for the committee, you should take the time to define its role, purpose and mission statement.
- Some Good Cheeses Stink...At First
Instead of avoiding possible critics of the plan, recruit them. You can turn them into believers and send a strong message to the rest of your employees.
- Scientific Analysis
Be open to experimenting new ideas in your communication strategy, but be sure to analyze the results to know if you're making a difference.
- Write A Review
Document the accomplishments and projects completed by your committee to know and remember what produced a quality result. Don't be afraid to include those activities that failed. We learn from our experiences.
- Deep Fry It
Being creative with a retirement plan isn't always easy, but it's possible. Apply your creative ideas to help engage employees.
- Good Cheese Isn't Made Overnight
A successful committee requires patience to become comfortable with roles and responsibilities. Don't set yourself up for failure by expecting too much too soon.
- Cheese As The Main Course
To become a main course in your company's culture, your ESOP and its communication committee need to be seen and heard.
If you avoid these 9 common mistakes as best you can, your ESOP committee may become a true "connoisseur" of ESOP communication.
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This article originally appeared as a chapter in The ESOP Committee Guide, 3rd ed., published by the National Center for Employee Ownership (www.nceo.org).
- "The Employee Ownership 100: America's Largest Majority Employee-Owned Companies," NCEO, last modified May 2011, http://www.nceo.org/main/article.php/id/11/.