Summary of Podcast on EP24 - The Power Of Monthly ESOP Communication With Diana Clark

Summary of Podcast on EP24 - The Power Of Monthly ESOP Communication With Diana Clark - The Grid Wiki

August 29, 2024 [0:13] Hey everyone this is the ESOP guy and we are on a journey to an ESOP and Beyond and so excited to share this next episode with you we are going to. Jump in a little bit deeper to ESOP communication and some of the. Some of the things I think are really helpful for for companies and Diana Clark has been with us before and she's on our on our ESOP team. And this is her primary role in how she goes about helping companies all over the country um I would say. Kind of in enhance their their culture with the employee ownership concept and obviously that takes a lot of communication so Diana welcome back to the podcast. [0:52] Hey I'm so happy to be here thanks for having me backcool so yeah so let's just do a quick I know with with you were on before so this will be your second round but just for people that are joining and and listening to you for the first time um just give us a quick background like how did you get an esops and how did you get to kind of to this piece of your career which is really helping companies on the communication side. [1:15] Yeah yeah so I graduated with a bachelor's degree in economics and like so many of those in the esap space I didn't know what to do with with an econ degree so my first roll out of college was working for a retirement planning firm um I was with American Express and it was in that space that I learned about esops and really became motivated um then to. Want to work on the HR side and so is my career evolved I also ended up getting a master's degree in Human Resources with a specialty in like training and development. I went on to work um as a college administrator for a local community college and. When you are in that space you get thrown into the classroom so I ended up teaching a variety of business and economic courses. And then I worked for a uh an employee-owned organization for over a decade in the northern Indiana area. And so it was really in that space where I had come from you know a background in retirement planning. Education and HR where I feel that I just organically landed here and my company sold. [2:24] In 2022 and it was at that time that I was inspired to put all those skills to work and here we are so I'm able to you know use that background in retirement planning and education and as an HR leader to be able to help others through their journey to an esap and Beyond it's awesome yeah so 1 1 of the things I know that people say as they get to work with Diana is the it's really helpful because she's been on the other side and terms of like she knows what it's like to be an employee of a company that has an ESOP. And even though not just being as a sea Suite HR exec but to be part of the of the group of employees how much does that help you when you're you're talking to companies and they're like brand new and ESOP or they've been around an ESOP you know for maybe a year or 2. [3:12] Oh you know it's so helpful because I think what really inspired me to get here is through my own journey and so I was with my former executive team when we transitioned to an ESOP um I worked for a family-owned organization in the South Bend Indiana area and right after I started in that role we had the discussions about transitioning to an ESOP for all of the right reasons for all the same reasons that we hear you know to to preserve Legacy and to give back to the employees that that had really helped us get the company to where it was today and so through that own transition I was you know serving the company but then I was also an employee owner so it really impacted me on kind of both sides of the house. And I always. [4:01] Those you know clients that we're working with that I had some pain points in the first couple years post the close of that transaction and it was actually about 10 years ago when I thought to myself this is what I really want to be doing post my time with this organization there really is an opportunity to to apply um. What I what I learned the pain points that I had and also to help others so you know being able to reflect on my own experience and help others has been really beneficial in this process. [4:34] No and that that's I think what's great about it a lot of people that do provide like me advice for esops like I've never been in ASAP company so it's just helpful to have that connection you know especially for what you do which is you know helping you know if you talk to the people that are running the ESOP or the ESOP committee or you've been there so it's I think that's a really. [4:57] A a natural way to go about like helping them you know and so I can't I think my next question is just more about as we get closer to where we're going to get into our main topic um which will be monthly education um just generally speaking why should any employee care about having an ESOP like why would that be a movement for them in the right direction. [5:17] Yeah why should they care oh because it really matters you know working for an ESOP companywell there's so many benefits and you know we could call talk all day just on on the general benefits of of working for an ESOP company but when you're in the employee space and you get to walk through the doors every day or maybe you know you work in a remote position and you are connected to something that was greater than it was the week before you were an esap it just makes that that connection to something that's greater and more importantly you have a chance to help shape the future of the organization through the role that you do and so at all levels of the organization you know what what we need employees to know is that their jobs matter. [6:05] And employees are the heartbeats of the organization you know they're what makes that esap tick and so if we can you know not only motivate them to understand the value. And working for an ESOP company um you know that's a role but then in a leadership role it's our job then. To also you know educate them on how the company's performance impacts their esap benefits so it really goes both ways. You know and so from a personal standpointwhat resonates with an employee is it hey I got more possible wealth in the future um or is it hey I have more control over my destiny than I had before you know I mean I think 1 of the things that happens is the alternative to an ESOP is I could just sell the company to a strategic sale and the new buyer says hey we're not going to. You know maybe do it this way before like you guys are doing this way where we're going to do it differently or we're not even going to need your job I mean I could be something so what do you think resonates mostly with an employee when they're when they're finally finding out hey we just sold this company to an ESOP. [7:10] Yeah you know I think the first 2 things that you just mentioned its wealth it's you know it's what's in it for me there's the cash you know. That that's kind of front and center but then I think on the control piece if we talk about just job satisfaction I think that there's several types of employees you know what motivates an employee that incentivizes them through cash you know that's kind of 1. Personality type of an employee but then you have other employees that. You know yeah they're motivated by the money and the cash but they're also motivated by making a difference um they're motivated through having greater job satisfaction at work and so what you know when you kind of combine those 2 things then I think you have kind of The Best of Both Worlds when it comes to Employee Engagement. You know being able to articulate that to them on on. [8:04] What the esap is how it benefits them you know so we talked about a lot of different factors and and how that drives Employee Engagement. [8:13] Yeah and that and that's something that I think in the and this is something we've talked about before but in the industry the rule of thumb. It seems like for the engagement of employees once an ESOP is is closed. Is usually like people say well it takes about 3 years for that really engagement to to start to happen and and I think the reason they say that is because. You know if I was the employee and I'm operating from what's in it for me type of mentality which is just kind of normal I'm looking at the participant statement and I'm saying all right I have this many shares this year okay okay I got shares great but whatever and then the next year you get another group of shares and that's worth something and then so maybe in the third year they really start to see the impact of those shares compounding um that I think that that's the rule of thumb but what what are your thoughts along that as far as what the expectation is for employment engagement and then and then we'll talk about like what maybe what it could be. Yeah yeah I think that's a great question and I hear from a lot of company leadersthat there's just nothing to really talk about in those first few years and you know so my perspective is that don't delay and you know here's why because when you. [9:26] Invest the time into making the esap transaction happen and then you make this rollout statement that we're now in ESOP and and you don't ever Circle back to it you lose an opportunity from day 1to to not. [9:41] Really hone in on driving employee communication and and and education so so you miss out on those opportunities and more importantly like the return on investment that we want to be having with these companies as employees too is we want to start talking about. You know why is education and communication important because it helps align business goals. You know now that we're an ESOP we're going to continue to to operate the company as we always have. But now as employee owners we need to educate them really on what our goals are and how do we get to those goals and by by working on. Communication and education Topics by taking the time to do that too we're also missing um. What we want to be sure that we are not missing out on opportunities to to drive things like continuous Improvement and Innovation um so don't delay don't delay. [10:39] Yeah don't delay and I think partly. It's it's always going to be in my opinion different because every company has like their own culture like a personality that company has a culture a personality and and you kind of have to work with that culture it's not like you can take something and like for instance if a company doesn't even have any idea like continuous Improvement or some other cultural initiatives you know then we're trying to like get them to do something that they're not typically going to do right so part of it is to is to really respect hey that culture the ESOP is an enhancement to a culture so it's more like how do we grow all that together um so but coming back to the rule of thumb I think the main thing is is I do believe. [11:22] In in just from my own perspective of being uh the CEO of our company you for for ten years and just dealing with a lot of clients on being a strategic planning different things like that I do believe communication is such a critical element of changing the rule of thumb and that what I mean by that is I believe that that there is so much more return on investment for an employee stock ownership plan for a company um then waiting for 3 years and absolutely that's kind of where I feel like we can go and you have had some great experience in you know as of late with companies that. [11:58] Hard looking at um you know they just closed and now hey Let's do let's do it differently so 1 of the things I know that you know you're looking at is like. Some clients are looking at this or a company saying hey let's do a monthly educational program. [12:13] You know so so inherent is like if I can do a monthly I create more frequency. I am doing a lot more than just waiting for 1 year so talk let's talk about the general idea like. [12:25] Number 1 what does it mean to have a monthly ESOP education plan yeah yeah so. [12:32] And how fun is it to build a monthly education plan so when we think about the more traditional ways that we announced the ESOP we we tend to do them in a larger forum you know we make that big announcement and and during those initial announcement pieces the company talks about the why behind the transaction and then we usually you know partner with individuals Like Us in the field or other communication Specialists to talk about plan details but when employees and their executive leadership teams. [13:04] Come together for the first time and talk about the ESOP it's often that like they're pulling off that Band-Aid. And were an ESOP and there's this now what moment but employees when they hear about that ESET for the first time they're also getting these like plan details and other information that's coming to them that they just don't always hear all the big takeaways and so when we we talked about like what can we do from that initial Outreach. Thereafter to really educate on the ESOP what we want to do is just take a an app of collaboration so for example and in a in a typical roll out meeting you know we'll talk about the why we'll talk about you know these are the plan details and this is what vesting means per se right but then if we do and we build like a a monthly lunch and learn program for somebody we might take those plan details then and we might recapture what vesting is and go through the go through that the schedule but then it's really important to collaborate with the uh the leaders and say well let's talk about why vesting is really important it's important that we attract and retain functioning employees you know that's part of the reason why we have a vesting schedule is because the cost of a mish higher. [14:28] And the cost of employee turnover is just that it's really costly to companies and so you know vesting is more about just the schedule and you have to stay and this is how much you get into your account but there's reasons why vesting is important to companies and so that's what those are the conversations that we want to be having you know post some of these initial Concepts yeah so from a. This this is where I think it gets interesting when you talk about communication because I think 1 of the things I see is that thethe people I deal with the front end of the dealer mostly the shareholders. [15:02] And then you know of course then I'll start dealing with some key people and then eventually you have this whole the whole population of employees and when you get in involved what you're dealing with directly you know you're probably the person in front of the employees at the first meeting. [15:16] And then from there you know you're back and forth with with maybe the key leadership group like hey this is what we want to try to accomplish and so when you when you go through that like idea of like. [15:28] How people like first off what's important to the employee you know what's important to shareholder what's important the key employee and then what's important to the employee those are obviously different things and you're trying to kind of communicate at all those different levels yeah. [15:42] So like you say like the vesting could be something to talk a lot more about I guess for the general population so I how does that message change with people you talk to number 1 and then specifically to just getting into like um what other areas would you want to if you kind of had to 12-month plan what would you kind of cover in those monthly meetings um to get the engagement I mean specifically this is for the engagement to get it up right. Yeah yeah so if we kind of said you know hey what what are the things that we should be talking about if we really dissect all the basics you know we talked about. [16:16] You know vesting we talk about plan rules. Um you know we talk about terminology like contributions and allocations um and then you know breaking the again kind of breaking those apart into like 1 topic. Meetings and what I love about our lunch and learn programs is that they're quick topics and we make them fun you know it's in more of a casual setting and so you're listening to a 1 topic session over the course of you know 25 to 30 minutes we allow for a lot of Q&A and then we also um that kind of platform too also allows leadership to join those conversations and kind of add their own commentary to it and then you know when we get out of the what I would call the more technical pieces of what year you set plan you know looks like in its design then you can get into some of the the more engagement pieces and so for example we have a. [17:12] Ization that we're working with right now we're probably 80% of their Workforce is 30 or 30 years of age or younger and so when they first heard about the. [17:27] Chrome or so you know when we talk about this is a retirement benefit you know they just kind of zone out and so we have to find a way then to talk more about like how do you generate wealth how do you build wealth for you and your family long term so that might be a conversation about umyou know what is uh the average 401K balance in America looks like what do you think you know is a 30-something what do you think that you need to retire on and most people those are interactive sessions and most employees will say well you know I don't know I think I might need you you know 500,000 or a million dollars or you know 100 million or a million or whatever yeah it's all it's all over the board right yeah right right. Yeah but we can say hey look you know just this quarter Fidelity and Vanguard Investments say that those that are. In the Z generation they actually need like 1.6 million to retire. And your average 401k account right now is probably only 25 or 30,000 so how you know how do. How are you going to get there and this esap this vehicle is a really good way to help bridge that gaps so some of the programming that we put together can be designed for your Workforce um I like to ask. [18:51] Those in leadership positions you know what's the real world word on the street what are employees really saying do are they thinking that it's fluff um. [19:02] You know and then let's address those things yeah I think there's a you know I had a client. That I did an interview with recently and we were talking a little bit about the idea that some people don't even trust that this is real. [19:15] You know first off like this ESOP is like something they haven't heard of before and then so you start off with that understanding what it really is. And um and then you go through that I guess there's a stage where they just start to kind of like they're just skeptical you know I'm sure a population of people are just are generally skeptical like this is just another. Thing that the company's going to do and you know and they don't really maybe even trust that as as people so do you how do you how do you directly deal with with the Skeptics like you know maybe in the first year and you know is it just take time. [19:51] Yeah that that's a great question part of my former Workforce had umwell half of it was uh. [20:02] Male male Workforce you know 25 to 30 year olds and every day they would uh at lunch they would be on draft kit DraftKings making their bets or they would be talking about Bitcoin and so when they would give me a hard time about you know what we were doing with the esap I would just say hey guys you know look you guys understand what Bitcoin is I said esops are really abstract too but it's no different you know so what we have to do is just teach them the concept and show them a vision of of what it can be. [20:36] Yeah I love that so yeah I kind of meet them where they are anyways at the same time you know and so that's I think that's challenging too just in general because you have like every company depending on how many employees they have they're going to have demographics that are just. Different right so you have all the generational you know differences between Baby Boomers xers Zehrs I don't even know Millennials um you've got the you know we have a CL a lot of clients we've closed their deals and they have Spanish speaking people you know so you have this 50% speak Spanish and then the other I mean so it's like how do you I mean you you're in a in a a a cool job but it's hard like how do you how do you fit the all of the differences into your style like the you got these 25 to 30 year old males and they're talking about Bitcoin alright so how much how do you work that into the monthly educational meetings and and if you know or are you just trying to like blanket across and hope hope to hit everybody. [21:34] Yeah no another really good question you know how do we design programming to be a 1 size fits all when we only have 30 minutes a month to do it and and I would say that that the best response there is is that you just don't you know because not everything is a 1 size fits all um but what I I think the best strategy is is to. Collaborate with the organization to get an ideal for you know what their Workforce is you know what does the workforce do um. [22:06] Uh you know what are they are they making widgets are they people that are working and Advising groups and then you can kind of tailor. You know your messaging your frequency of messaging and how it gets delivered you know considering some of those factors and. We have um in my former organization we had 13 different offices so we had half of our employees were remote half of them were working in a manufacturing facilities and then half of them were servicing patients so I came from a healthcare organization and so what I find works best um is that you do a little bit of everything um you know there's some generations that still like handouts and pamphlets um there's others that really like teams Channels with a Dumping Ground of where they can go to get resources. Um other employee groups like to play games and activities so it helps reinforce that learning and others just like um information delivered to them in you know 25 or 30 minute kind of glimpses you know we we're in a generation where people love podcasts they can get great information quickly at their fingertips while they're driving down the road so um you know our strategy is really more holistic to try to um reach each and every 1 of those employee groups. [23:27] Yeah I think that is the key right is is to try to be as creative as you as you can because you you're you're right there's no way you can do everything for every single person in the company but at the same time. It gives us an opportunity to try and I think absolutely you know the 1 Word that keeps kicking in my mind is just creative be creative with your communication and and try a lot of things and that I think the 1 thing about this podcast episode today is really just about I think what we're talking about is the frequency of how much you engage people in the concept of employee ownership and this idea that well you know. I think that there are some people that are thinking like there's not much to talk about as you've kind of said already but because there's such an opportunity to be creative with multiple ways to go about it. Like with you just what you just described then at the same time we could you can program something I think the problem is people aren't really prepared for this. [24:24] And they're not they're not proactively programming you know the year like hey this is what we're going to do let's adjust accordingly. Um but maybe they're planting other things like Hey we're planting um our new renewal of insurance right they're planting stuff already so I think it needs to in some sense get in and everybody's head like this is definitely something you should plan every year whether you're brand new ESOP. Or you've been a Nissan for a couple years or you've been in esap for 20 years what are you doing next year and how are you planning it and I think the than what we're saying is like you definitely should be thinking about more frequency and more creativity and just being and that can help you know sometimes it just get everybody on board and come up with some workshops and figure out what the best way to do that is or have somebody like Diana help you know but those are those are things I think that kind of where we're we're Landing is like those are ideas that just are helpful right. Yes very helpful in building yourself out what I would call like a 1-page you know ESOP strategic plan and. [25:30] Frequency is important but quality is more important and so you know considering your bandwidth you don't have to do it alone but if you said you know our goals this year are are going to be doing like a 1-time a quarter esap program that's year 1 that's fantastic you know let's we can help you build that out or you can do it yourself. But set that as your goal you know maybe year 2 as you start to do some Buy in you know by monthly programming so now you've got some 6 programs but to the point of creativity. [26:02] There's so much opportunity to talk about your ESOP in what's already happening in your general operations and as we're you know taping our podcast here at the end of August and september I'm thinking about you know in Q4 what some companies might be going through um in terms of their employee benefit package and so a lot of organizations have um a health insurance renewal you know come January 1 that's when the new health plan starts but Q4 is when they're really you know kind of putting all that work together so when we think about um a common term called employee open enrollment you know where benefits are new people have to fill out their paperwork that's an opportunity for the company to talk about you know what is a total compensation statement and as we're thinking about our health insurance renewal for 2025. As a leader we can be talking about you know the impact and value of the importance of having a really good employee benefit package and what that means is an ESOP company but as an ESOP company too it also means that that we are mindful of how we're spending our dollars on employee programs and employee benefits and so those are. [27:13] Conversations that we could be having as leaders and everything we do and so if you like that idea you know use that you know this coming fall um. [27:25] And when we think about you know the to the the term total compensation and what that really means to an employee. Um that means for every dollar that they put in their pocket from a wage the companies the company spends and other you know maybe it's another 25% of that dollar to keep that employee on payroll to pay the taxes to pay their benefits and oh by the way what's the value. Of the ESOP and so if you have a a mature plan or maybe you're in year 2 or 3 with your ESOP. You're now able to look at what that cash value what that cash benefit of that ESOP. [28:03] Uh is and you can help that employee understand you know what the benefit of that is too so. I guess I guess our point is just that there's so many opportunities um it just takes some creativity and some thought into what you're doing in your operations. And trying to align it throughout the year and how we talk about the ESOP and what drives that. Yeah I I agree and I think that'spart of just being continuous Improvement minded around like they we can always do something better like then we are doing right absolutely and not to say you know there are some companies that that are doing this phenomenally well on their own and there's others that that are just starting and so so part of that part of the topic today is just to get some of those thoughts on the table or lease gear up it's a good timing I think too because we're getting closer to the fourth quarter then you can start really thinking about 2025 plan and so I think that the timing of this episode is really helpful. [28:58] So 1 1 thought I was going to get more you know I was going to get a little deeper into um some of the things that you. A couple a couple things like some of the things you would get into on um monthly education categorically right so for an employee. 1 of the thoughts I had is they got to know they got to feel a sense for like how do they contribute. [29:19] To the B to building the value of their own ESOP plan like so if I had to kind of compare that to a business owner should know how they build value in their company right they should know that you know if the company's going to grow and profitability that's going to be good for them those kind of things so are you seeing some of that type of thing come about in your um in your monthly educational lunch and learns. [29:43] Yes we're starting to see more of that and I think that that topic you know I would put that in the the employee kind of financial literacy bucket there and that's really. An initiative from leadership or or management to help employees understand how their role. Directly impacts the company's bottom line and so. When when we talk about um you know employee impact and job performance those are collaborative conversations for sure that that we're having with company leadership so we're having. Though not only those types of conversations um. [30:20] And I would say that those are kind of Elementary right you know we pitched the ideas but then the second round of that is. You know hey we might then just carve out a team of customer service professionals and have them like a mini workshop with them along with their leadership team to talk about you know Innovation process Improvement. You know purchasing customer service um we can really get into that then on a deeper level oh I like that idea yeah so kind of. Yeah so when you start thinking about I always kind of think about the big picture like how does this like help the company how do you how do you help the company grow but if you do break it down into departments. Like that you could probably come up with maybe they don't even have kpis that they're following like the the customer service department so maybe it'd be like hey let's create some kpis let's measure those you know and get that level of of business Acumen going in in regards to you know department so I think that's a really interesting idea. [31:18] Yeah we do a lot of of um I call it like a company scorecard you know and it really is that kpi. I would like to see leaders do more of that for those departments because employees want to help they want to be helpful they want to know you know what the rules are and how they can you know you know maximize that esap benefit but they can't drive performance if they don't know what the score is or or if they don't know you know what those opportunities are so I think as Leaders if we're willing to you know sit down with them and carve those out and show them how they can make an an impact it it goes a long way. [31:57] Yeah and that's just a good business practice anyways right but the reason this is tagged to the ESOP is that they're they get a stake in the in the value creation so it's it's just naturally fits into we should be doing you know these different things um 1 thing that comes up I think for for some companies that are afraid of they they think we're talking about open book management where we're not talking about open book management I think you can do all of this type of um communication without you know saying hey here's are gonna we're gonna open up our financial books to you guys and I think that that's something people ask me all the time and I'm like you know some companies do that and that's cool like they're open book management companies others are like closed book that's fine but what we're talking about really is about understanding the Dynamics and financial literacy as as far as like East your example of customer service how does that impact this right ultimately it it it is you're going to see that. In the share price So eventually you're going to see the the benefit of all that and the share price but if you if you break if you break it down to buy Department then then you're not really dealing with hey here's everything that you you're going to want to look at. So and is that something that comes up in your conversations with the leaders and then how does that come across from the employees. [33:13] Yeah you know I think leaders post the transaction phase I think they know that somewhere along the way. They're going to have to address like how are we going to be talking about company financials in the coming year you know what's Our obligation do we have to show everybody the book so I find that we have a lot of. Um kind of exploratory conversations and and they sound like well what are you doing now you know are we releasing targets and goals. Have you ever talked about company financials and so the way to start with that I I like to put it in you know just very basic terms is. You know let's start with some kpis and let's just create a vision of where we're headed. And give employees uh you know kind of enough Direction on how to. [33:58] On how to hit those targets um and then on the financial piece too um again those those can be very. Confidential conversations for years to come but employees are curious about what those numbers are and so you know I I guess our kind of guidance items to them is is to start um releasing what the goals are and then give feedback on those goals so if you know our goal overgrowth is 10% what it was for last year you know check-in with employees and say hey our goal was 10% growth we're only at 5%. From where we are last year you know this is how this is what we need to do to meet our targets over the next 6 months is to just you know start making um ways to. You know start laying breadcrumbs so you could have those conversations. [34:52] Yeah and I think trying to break down a scorecard is the best way to do it because you need to make it relevant to the position there's nothing more you know frustrating for somebody like hey yeah we need to grow profitability but they they they're only you know they're obviously contributing to profitability but only at that level of what they can control yeah and so. It almost works better just to drive into the customer like service department or the sales department or the you know the the manufacturing department and and reflect the scorecards around the things that they can control um and build budgets and goals around those those kpis as opposed to just. Just the bigger financial goals that that we can kind of get stuck into so strategic planning I think for an ESOP company. [35:38] You know can look a lot like strategic planning for a non sub company but it can be a lot more powerful because you're able to drive into each of these departments with scorecards and make it meaningful to them and that I think that's kind of part of the idea behind um what what true financial literacy looks like for an ESOP company. Yes we had a a larger um purchasing department and so you know on the purchasing side they definitely um have have a huge impact on on their purchasing power and savings. And so that's you know from a company's perspective you know we can work with departments like that and show um you know show cost savings from year over year to you know so those are things that as Leaders you know we we don't want him to be afraid to get in there and do that but that's really what's going to help those employees understand what kind of impact they can make. [36:29] Right yeah and celebrate those those successes and victories you know again more frequently than just. [36:36] Hey here's your participant statement so you know and that's and that's kind of where we're leaning into right now is just is how do you have more conversations about this in a way that is is going to move the dial a little bit farther a little bit quicker um a little bit stronger than you have in the past you know with just you know once a year type of meetings so. [36:55] Yeah they've worked really well you know we we can talk to employees in larger groups about kind of the overarching benefits of esops but then we can also work with you know organizations to have more of these like micro conversations yep so um as you go through the the different things that you've seen so is there anything with an employee meeting that this is just kind of like something that people I'm sure think about that have you been in a position where it got super uncomfortable like because you got into a topic you know let me just say it like some employees might be super outspoken right and they may ask some really really um bad question not not you know in the sense of like opening a topic that's just uncomfortable for for whomever it might be they may be like hey well you know they might be asking us about compensation or things that are just you know not something you want to get into I get an open Forum have you run into stuff like that and then I guess the deeper question is how do you prepare I think sometimes people have anxiety of having these employee meetings because they don't want to get like into a difficult awkward situation. [38:08] Yes whatever yes whatever you put employees in a room together and and you get you know all sorts of Dynamics around the room there's always an employee or or several that asked uh the inappropriate questions and so I I would say almost every time we meet with employees somebody's going to ask a lot of employees I think you're just genuinely. Curious about the money like hey you know this is supposed to benefit me but we think it's going to benefit you more you know what did you sell the company for. You know I think the best thing that that we can do is to help our leadership teams know that these questions are coming. And you know to just prepare some mindful responses to the more difficult questions for sure. Yeah because there's a there's a sense of culture too in that like some companies are more transparent like hey we'll just whatever we'll just share with a whatever and others are like no and and part of it you you can get what what I think the biggest issue is you can get so sidetracked on something that's a tangent that's not really that important but but an employee might make a big deal out of it and and I think the idea of having a mindful responseis helpful to. [39:22] Deescalate that so that you can get back to the main the main thing the main thing is this is 100% benefit to you you're not putting any cash into this. Yeah as long as you work here you get this you get this benefit. I think 1 1 thing that has popped up in my head on meetings with companies is you know the sense of like we're. You know as employees we're at risk of something like they they feel like there's some conspiracy or there's some kind of you know risk of something happening and you know and it's hard for me because I'm like well you didn't put anything into it. [39:55] There's always business risk so I always kind of get to that point I'm like well. You know maybe we need to put that on the side and say hey we'll have a 1-on-1 with you or you know so what would some of those mindful responses be you know that people areyou know prepared for that kind of thing if if they they engage people at this level yeah I I think. [40:15] I think the most common question is always about the money like what did the company sell for or are we going to have access you know the the financials and and I think a really mindful response would be you know. As a leader we we know that this information is important to employees so simply saying you know hey we know this is important to you and we have a plan over time to become more transparent with the numbers and this is what that could look like so for example next year we are committed to. Putting up the company scorecard which means that we're going to have 2 numbers that we're going to track we're going to track a profitability number we're going to track a sales goal. And we want you to be part of that and here's what that looks like and then you know maybe in year 2 and 3 we're going to actually start talking about um we're going to talk more about the ibida you know that's a really important number to start talking about and how we get to that so A mindful response is you know letting employees know that leadership understands that this is important to them. And then offering a plan to address that and what does that plan look like in the years to come. [41:25] Yeah I think being I I would say too just to boil it down being prepared is is going to be really important. For for that and that's and that's 1 of the reasons I brought up the topic on the awkwardness because then you if you are prepared and you work through it then you're going to have more of these meetings if you're not prepared and you get blown up you're not going to have these meetings anymore and you're like I'm done let's and that's going to be counter to the whole ESOP concept like the the the we have to we've got to engage people on conversation like we if we don't we're going to be in this position of like nobody knows what's going on and so we want it to be a positive thing and I think that's part of realizing I would say that 1 of the 1 of the reasons we're doing this this this episode 2 is because I think that there's a there's a sense for. Some companies like hey I can just do this like this will just happen because we're such a good company and and all those things are good um and I wouldn't I wouldn't say anything negative about that but but there might be. [42:23] You know hey we're a little bit overestimating our ability to man to navigate through ESOP communication because we're good at this other stuff and I and what I'm saying is is that because there are a lot of nuances to it it's really helpful to have people help you go through this until you get to that through that learning curve and you're like yes we got this and so that that's my concern is and then you try something it blows up and you're like oh my gosh let's not do anything else let's just go back to doing what we did before so so that's kind of the part of my thought process is I want to help people think about this proactively make sure you got the right and this is just to me as important if if if anything of doing a good transaction like you know if you don't do this well then some of the elements of what you did the transaction for start to kind of fade away. [43:12] Yes and to your point too what we often see is just bandwidth so the transaction happens and then. [43:21] Perhaps some of the people that were involved in the transaction then end up taking on maybe some ESOP administrative responsibilities or communication responsibilities but those those folks go back to their full-time jobs and so this becomes kind of a secondary piece to the operations it's a very important piece but it's just additional kind of work then that. Um kind of gets baked into their job and so at that point too when you're assuming new responsibilities you kind of don't know what you don't know um you might have a really great vision but that bandwidth you know how do we come up with programming and how do we execute it that that can be really challenging in and of itself and then you know we were just kind of talking about those that you know I I call it like they don't always drink the Kool-Aid so so you know when we really think about our programming we want to be sure. [44:14] 2 that we're heading you know I call it kind of a bucket process so we want to make sure that we're checking something off of a bucket that talks about business and financial literacy that we've got some things baked in there on culture and team building um you know we're talking about Innovation and then we're just providing general education on this is your esap plan these are the rules and this is how it works and how it applies to you so I think when you you know when you look at all those things it it doesn't happen overnight and if we can talk about you know what is the best practice it's really to just build out a plan um. That that you can look at is a runway for up to a year and then nurture that plan and then measure it you know after you've had 6 or 12 months of of programming in place measure that programming elicit you know feedback from employees um make sure that they understand that the that the esap benefits them and how it benefits them and then don't hesitate to deviate from your programming if you need to make some adjustments yeah I think that 1 thing about measuring. [45:23] Is so important whether you're an ESOP or not anyway but an engagement survey that helps to kind of you know I remember thinking through like I got on a bell curve I've got my actively engaged people that are just like so they're the cheerleaders of the company right they're way over here on the the 1 side of the of the bell curve. Then you have your way on the other side of the bell curve you're actively disengaged people and I would call them the toxic people right they're they're probably not needing they shouldn't even be there to be honest with you because they are never going to move off the dime because they are just for whatever reason they're not good they're there for for the wrong reasons and then you have your big bell curve and you have everybody in in between and I think the goal is as you measure engagement surveying is to see. Where are your population is and start moving the people you can obviously to the right as far as you can. You know and I think that like your point of measuring is important because if you don't measure you're going to be guessing at this all the time. And there are a lot of places you can get these surveys I know Diana um Can can recommend different things you know to to companies but the both the bottom line is definitely if you're going to do something measure it and see if it's going to have an impact on the company absolutely. Absolutely it's your score it's your it's your report card as well that's right yeah and that's and that's the job I think Job 1 coming out of the gate is like. [46:39] You know figure out what it is and start measuring the engagement and and hopefully you're seeing you know year after year success with that. Um and if you're not then you you just need help because this is the this is the job you know is getting people um. Excited about it and engaged and and wanting you know they are actively engaged and they're going to tell everybody they know about it and it's just gonna it's just gonna be a good good cultural thing it's the same thing with the people that don't like it or they're they're going to just tell everybody they don't like it and so so you're constantly battling you know internal communication in the process. [47:15] 1 thing I wanted to say too is just like what we're talking about what I think Diane and I are talking about this is this this may just be me in my opinion but this is really in my opinion Cutting Edge ESOP stuff you're not seeing companies do this on a monthly standpoint um what Diane is doing is. I I my opinion is Cutting Edge because it is pushing the envelope towards things that that you're not seeing as a standard best practice. And you know and it's called 2024 2025 I think in the next 3 years. That you're going to see more and more what we're talking about becoming a reality um but the reality is what I was saying earlier is that the rule of thumb is hey we'll just kind of wait for the next couple years the message at the end is this don't wait get going you know and don't be kind of like reactive be proactive and and those are things I think are are going to be super helpful and and and and stuff like Diane is doing is is is really contributing a lot to I think changing the mindset for the ESOP industry. [48:17] So thank you um so any any last words that you would say for people that that are thinking about this um or you know in those different stages. [48:26] Yeah yeah umdon't delay you know and and if you're really struggling I think to get some Concepts or some programming in place you know don't hesitate to reach out you know of course we would love to help you but there's so many Fantastic resources in the esap community um. [48:46] As well that can serve as an inspiration um but again don't delay because you're just missing opportunities to to grow and engage your Workforce and align your goals um but think of you know think of this too is being a process of how do we be executive leaders for esops. And I think that that's really what you know it kind of boils down to is that there's a lot of leadership momentum behind it a lot of creativity and ultimately we just want to impact the bottom the bottom line we want Employee Engagement to impact the bottom line. [49:18] Great well thank you thank you again for for your time todayof course of course happy to be here. [49:24] So for everybody else thanks for joining today um we are excited to continue to share more resources and topics with you if you do have questions about anything related to ESOP whether it's pre-close post close please you know link link up with us on our website at journey to an ESOP calm and we'll be happy to reach back out to you so with all that um enjoy the rest of your day and we'll see you on our next step on this journey to an ESOP. [49:51] Cool.

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EP24 - The Power Of Monthly ESOP Communication With Diana Clark

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