I would like to introduce the first member of our All-Star OB team. OB of course refers to Organizational Behavior, the meat and potatoes of this course. His name is Jim Goodnight. He is the founder of a company called Statistical Analytical Software (SAS). As the name suggests, the company is heavily involved in the technology industry. However, Jim does not run his company as a bland, uninteresting mass of tech developers. He has injected life and creativity into his workforce. He offers his employees a great deal of perks and benefits. I could not do the company justice by describing them all in one post. Therefore, I will be making multiple entries that highlight a particular aspect of SAS’s employment policies. But as the old saying goes, a picture is worth a thousand words. So if you don’t mind, please click on the following link. It’s only six minutes long and you will have a great foundation for further discussions of SAS. Apologies for the short commercial.
Can this be real? Set your hours at your convenience, 35 hour work weeks, a full recreation center, a personal masseuse and a hair salon, all while relaxing to a serenade from a professional pianist at lunch? No, this isn’t the “real world” we have been warned about for our whole lives. Coworkers don’t actually care about each other and employers certainly don’t care about their underlings. Or do they? To begin interpreting this, we need to look at the source: Jim Goodnight.
There are two very broad and basic schools of thought when dealing with leadership behaviors: task oriented leadership and people oriented leadership. Task oriented leaders give very specific instructions and goals to employees. The employee’s ability to carry out these orders determines the success of the group. On the other hand, people oriented leaders take a more personal approach. These leaders show genuine concern for their employees’ feelings. This type of leadership is marked with a distinct level of respect that is given from the employer to the employee. Jim fits the latter category perfectly. While he is concerned with the financial success of the company, he entrusts the success of the company to his employees. He believes that if his employees are happy, they in turn will make the customers happy. And when the customer is happy, everyone wins. He has exerted considerable effort to make his employees feel at home while at work. From the outside in, it doesn’t look like home at all. It looks more like a vacation.
It is important to keep one thing in mind as we continue to talk about SAS: every employee at SAS is a salaried employee. Not one single job at SAS is outsourced. Gardeners, cafeteria workers, daycare providers, and even the company’s “professional artist” (whose sole responsibilities are the creation of paintings, sculptures, and other works of art) each draw a salary and are eligible for all benefits. Janitorial workers have the same health plans as senior managers and “lunch ladies” have full access to the gym. Everything is available to everyone.
Jim Goodnight has clearly challenged the status quo of the business world. By offering his employees so many benefits, he has significantly raised the cost of doing business. Medical expenses will be paid to a large number of people, someone has to pay for the buildings that have been built for the employees, and countless hours of productivity have been lost. Goodnight could be one of the most fiscally irresponsible leaders in history. Or is he one of the smartest leaders in history? Employee retention is astronomical and voluntary turnover is scraping the bottom of the ocean floor. How many dollars are saved by avoiding recruiting and training expenses? Actual occurrences of health expenditures may be low because of the personal trainers, physical therapists, and fitness centers on site. Is the cost worth it? Conventional business leaders may not be able to justify such a large outlay for employees because it would take a long time to recoup the invested capital. What do you think, is Jim delusional or is he a visionary?
Over the next couple weeks, we will look at what makes Jim Goodnight an impact player in the world of business. In my next post, I will continue to investigate what sets Jim apart from the pack. Specifically, I will tell you why Mr. Goodnight is a transformational leader. I will reveal more special perks made available to SAS employees and discuss how these benefits affect the workforce’s morale and motivation.
-Jarek Palmer
After learning a little bit about SAS in class, and then reading your blog post, Jim Goodnight seems like the ideal boss. I really hope to see over the next several years more businesses moving in this direction. It is important to remember that you are working with people--not robots. I think Mr. Goodnight does an awesome job of addressing this and building his business around it. I don't know that everyone would be able to handle this kind of independence that he offers, but I do think that for those that can, it is a great environment to work in.
ReplyDeleteI like the point that you brought up about Mr. Goodnight being one of the most fiscally irresponsible leaders--but is he? All that he is saving through productivity, not having to hire/train people, etc., he may really be onto something.
-Posted by: Jenny Liechti
I for one would love to be an employee of Jim Goodnight's. In response to your question, "is he delusional or a visionary?" I would have to say he is definitely a visionary. Yes, companies may have trouble deal with the initial costs associated with running a business in such a way but in the long run, I think everyone benefits. The company reduces turnover and workers are happier leading to higher productivity, both factors of which will enhance SAS's business opportunities and capabilities in the future. I believe that more and more business leaders will start to move to this strategy of management which will lead to a much better corporate world.
ReplyDeletePosted by: Brittany Meredith
Jim Goodnight sounds like he is making some excellent moves towards employee satisfaction. We can't help but wonder, will this soon be the only way to run a business? Potential employees would be lining up at every door.
ReplyDeleteIt is very interesting to think about how Goodnight saves so much money on employees by spending so much money on hi employees.
Mr. Goodnight truly is a different kind of leader. He believes that success is achieved through his employees. By viewing his workers as assets, rather than liabilities, he has opened the doors to a revolutionary way of thinking. Happy employees will make customers happy. And happy customers make shareholders happy.... except that there aren't many shareholders at SAS. Jim Goodnight and John Sall are the only reported shareholders, owning 2/3 and 1/3 respectively. They are the co-founders of SAS and have refused to go public with the company. This enables Jim to do what he thinks is right. He is not at the mercy of Wall Street analysts or stock market speculators. Goodnight is free to make decisions that add value to the firm, and he has clearly done so.
ReplyDeleteMany CEO's will be frankly unable to do the things Jim has the freedom to do because of the regulations associated with public companies. However, they can learn from the philosophies that Jim uses and the ideals he stands for. The leaders of today can greatly improve business simply by observing organizational behaviors, environments, and cultures. Once we understand the current situation, steps can be taken to optimize efficiency, productivity, effectiveness, and..... happiness.
Regards,
Jarek Palmer (BBB)