What You Should Know About An Organization
by Tom Washington
Choosing the ideal occupation is often considered easier than locating an ideal organization. There just aren’t many really good organizations to work for. That’s why employer research is so important. Going to work for a new company is always a risk. Your goal is to reduce those risks and find an organization that matches your needs. I’ve described some of the factors you’ll want to know about before accepting a position.
Failure to consider these factors and to learn as much about the organization as possible, can lead to frustration and even grief. Suppose you’re a person who needs a very stable work environment, yet you go to a company which is experiencing a reorganization, a shakeup in top management, or is being absorbed by a larger company. What if ethics are very important to you, yet your company misrepresents its ability to make delivery dates? You owe it to yourself to learn as much as possible about these factors. I’ve tried to stimulate your thinking so you can determine what is important for you.
What is the potential for advancement? Some positions are dead ends. Ask where people in that position have moved to in the past. For advancement the best jobs are with fast growing organizations in fast growing industries. As the organization grows and new positions are created, everyone moves up. Determine whether promotions are given by seniority or ability.
How does the place feel? Is it light and jovial or do you feel a heavy, serious atmosphere? Are people friendly or is there backbiting? You’ll need to use your intuition and sensitivity for this one. Some clues might be a gruff receptionist or people passing in the hall without smiling or saying hi. Don’t judge an entire organization by just observing it for a few minutes while waiting in the lobby for your interviewer, but make the most out of what you observe. If you like what you see, look for supporting evidence that your brief glimpse was accurate. If you don’t like what you see, gather further evidence to either confirm or change your initial impression.
Does the health insurance cover 100% of hospital, doctor, check up, and prescription costs? Some programs pay 100% but you may have a co-pay of $10 for each doctor visit and each filled prescription. Many health plans only cover hospitalization and even then only 80%. Do you receive dental insurance and a life insurance policy? Do you receive disability insurance? Do you pay for any of your own coverage or pay extra for family members? Do you get three weeks of vacation after five years, as is common, or must you be there for ten years?
Some organizations will allow you to accumulate sick leave and even pay you for a portion of that time after you retire or leave the organization. For executives there are additional benefits or perks, such as a reserved parking space, a company car, a decorating allowance for the office, stock options, and a full year’s salary if terminated. If it’s important, you can inquire whether you could have an additional two weeks off each year at no pay.
Some organizations offer bonuses or profit sharing. Sometimes profit sharing is extended only to management. Bonuses can range from twenty-five dollars at Christmas time to several thousand dollars and can be distributed by formula or by performance. When a formula is used it might be by number of years with the company or a percentage of income. In profit sharing a formula will determine the total amount to be distributed, although department managers are sometimes given a lump sum to distribute as they see fit.
Some organizations have dress codes, either stated or unstated. The pre-eminent example has always been IBM male employees with their dark suits and white shirts. In recent years even IBM has loosened up a bit. If you are bothered by working for an organization with a strict dress code, check it out. When you go for an interview, observe the clothing to determine the dress code. Of course there are some who prefer more formal attire: men who like wearing suits and ties and women who prefer tailored suits. Decide for yourself what you prefer.
Do you like to offer suggestions and have them adopted? Part of your success will depend on the openness of your boss. During your interviews you’ll want to assess this quality in your boss-to-be. Some organizations have formal suggestion programs and give financial awards to people offering money-saving suggestions. Boeing has a program where the cost savings are computed and the employee receives 10% of what will be saved during the first year, up to $5,000.
Are you happy in a cramped office with no windows and drab walls, sitting at an old, gray metal desk? If so, physical environment will hardly be an issue for you. You’ll be satisfied almost anywhere. Some people need a much different environment. It could be open spaces, sizable offices, bright colors, lots of windows, fresh air, the absence of odors or loud noises, paintings, wall hangings, sculptures, a fountain, beautifully landscaped grounds, a pleasant eating facility, and quiet places to eat or talk outside.
Ethics And Integrity Of The Organization
You will want to determine ethics and integrity at several levels: top management, your immediate boss, your coworkers, and those who have direct contact with customers. First you need to be clear on your own ethics. Here are some of the things that often bother people: the organization does not keep promises, sells known defective products, bribes politicians and purchasing agents, postpones paying its bills as long as possible, tells customers the product has been fixed when it really hasn’t, constantly looks for shortcuts which also decrease quality, backs out of commitments, misrepresents its products, doesn’t back up its warranties adequately, abuses its employees, terminates employees unfairly, lies to customers, over bills customers whenever possible. These are just a few examples.
Family-owned companies seem to be some of the best or worst companies to work for. Dynamic family-owned companies can make quick decisions, can take risks that would be impossible for a publicly held company, and can be exciting, rewarding places to work. Stagnant family-owned businesses which have been handed down through two or more generations can be very frustrating places to work. Some company owners are so autocratic and filled with “yes men” that they are almost impossible to work for. The real question is not whether the company is family owned, but how well managed it is.
In some family-owned businesses family members occupy the top management slots. If you want to progress, you may need to move to another organization at some point in your career.
Is everything done by the book or is there flexibility? A flexible organization can change plans or policies when the situation requires it and cares more for results than tradition.
Goals of the Organization
What are the organization’s goals? Is the organization trying to increase its market share, increase its workforce diversity, develop more new products each year, decrease its defective products, expand into new geographic areas, or decrease turnover? Knowing the goals of an organization or a department can be very valuable in determining whether you want to be a part of it.
Where can you go within the organization? Advancement is part of growth potential but there are other ways to experience personal growth: attending company sponsored seminars, taking company paid college courses, being given new responsibilities, or working on projects that expose you to new ideas or experiences.
History Of The Company
Just knowing that the company lost money last year does not tell you a great deal. Overall the company may have a very good profit history. Where has the company been and where is it going? Has it been involved with mergers, has it acquired other companies, how long has it been in business, is it making the same types of products it started with, have there been any major shakeups in the company, how did the company fare during the last recession?
Innovative organizations seem to be more fun to work for. There’s usually more challenge as they try new things, whether it’s developing new products or implementing new management techniques.
How far are you willing to commute? Is it located in a safe or dangerous area? Does the organization have multiple local offices that you could be transferred to? If so, perhaps your initial job would keep you close to home, but a transfer could give you a long commute.
Douglas McGregor developed the concept of Theory X and Theory Y companies. Each organization has a personality of its own, which is usually determined by the management philosophy espoused by top management. Basically, Theory X companies believe that people don’t like to work and must continually be pressured with threats, discipline or monetary incentives. They must continually be watched and their production must be monitored. Managers tend to be autocratic and domineering. Rarely will they listen to criticism or implement ideas that originated in the lower ranks.
Theory Y companies operate on the assumption that people have a psychological need to work, that they enjoy work, and given the right environment, will rarely miss work, will work hard, and will produce high quality products or services. Managers tend to use participative management to obtain greater results. Theory Y managers encourage cooperation and working out problems together.
There are other management philosophies and styles, but most resemble either Theory X or Theory Y. Find out the philosophy and style of the organization you are interviewing with through your own research and by asking questions during the interview.
The major distinction is between centralized or decentralized management. In centralized management all major decisions are made at the home office. With decentralized management a district office or a manufacturing plant is allowed to make all but the most major decisions without prior approval from home office. There are advantages and disadvantages to both methods.
Some companies are famous for their Byzantine intrigues. Often the backbiting, fighting for position, and rallying of allies is actually encouraged by senior management who purposely play off one executive against the other. Such infighting is never beneficial to the employees or shareholders. Competition within an organization can be healthy, but it can easily cross over into backstabbing and empire building. Determine the organization’s penchant for infighting and dirty politics. Most will want to avoid those organizations and the only way to discover it is through insiders. Government agencies and non-profit organizations can be among the worst for office politics.
Small- to medium-size companies usually retain their name even after they’ve been bought out by a larger company. Who Owns Whom is an excellent resource to discover if a potential employer owns subsidiaries or is owned by another company. As part of long range planning, working for a subsidiary is one way to eventually move up with the parent company. If your potential company has just recently been acquired, it may face some real shakeups in the coming months. That can be positive or negative. Negative if the job you’re hired to do is considered redundant or expendable by the parent company, negative if the boss who hired you (for whom you really wanted to work) is replaced by a less desirable boss, negative if the overall management philosophy changes from one you felt comfortable with. In exactly the opposite ways, such changes could be positive. Very frequently being bought out involves nothing more than cosmetic changes plus an inflow of available cash to expand into new markets or develop new products.
Most companies have some kinds of skeletons in their closets. Your goal is to discover them before you start the job. The vice president of a major company was hired away to become president of a somewhat smaller company, only to discover that he had been lied to about its financial strength. The company was near bankruptcy. It demonstrates that presidents making more than $1 million a year can also be taken.
An accountant was hired as controller of a company only to discover that funds had been misappropriated by company officers several years before. The three previous controllers, each of whom had stayed only about six months, had bailed out while they could. This controller unfortunately was still around when federal investigations began and his reputation was tarnished, although he had nothing to do with the scandal. Existing or potential problems might be takeovers or mergers, bankruptcy, scandals waiting to be discovered, old outdated products that will soon lead to decreased sales, union problems, or a lawsuit which could ruin the company.
Find out everything you can about a company’s products. Annual reports are one of the best sources because they generally describe each subsidiary’s products and also show pictures. By researching the products you can determine your interest. Can you relate to the product or services? Do you believe they have value?
Knowing both the profits and sales volume of a company can be very enlightening. Annual reports and articles you find about the organization at your library through resources such as Factiva, eLibrary, and ProQuest, will give you the answers. A highly profitable company can afford to take risks and try new things. A company which has lost money for several years has probably retrenched and cares more about survival than its employees.
Progressive firms are trying new things. If you have a hard time adapting to change, stay away from them. Progressive firms are at the forefront of hiring and promoting women and minorities, improving pollution controls, contributing some of their profits for the betterment of their community, demonstrating concern for employees, and trying new management techniques that show promise.
All national companies relocate personnel from time to time, but they have varying policies. With some you can refuse one or more relocations with no stigma. At others, turning down a relocation may mean no hope for future promotions. It can also mean termination or making life so miserable for you that you’ll quietly find another job and move on. You’ll want to know how soon a relocation might occur, how frequently they may occur, and where you might be sent. Most relocations involve promotions, but not all. You also need to know what you can expect from your employer. Will they make it worthwhile?
If it’s a promotion you should not only receive a raise but also an increased standard of living. When moving from Biloxi, Mississippi to New York, the difference in the cost of living is tremendous. More than one executive has found that the same house he just sold for $900,000 costs $1,500,000 in the new city. Find out what the company will do if you can’t sell your home. The progressive firms will buy it from you at a fair market value and then sell it themselves.
Learn as much as you can about relocation without having to ask your interviewer. Invariably this requires inside information. Until you’ve been offered the job, don’t ask about relocation. Most employers will explain their policy, but if not, you definitely need to know before accepting the position.
Every organization has a reputation. Local companies have local reputations and national companies have national reputations. Consumer product companies have reputations based primarily on their products. Even companies you’ve never heard of have reputations. Your best source of information is insiders. For feature articles use a search engine or through your local library, use resources such as Electric Library, Factiva, and others.
What percentage of sales is being plowed back into R&D? Money alone won’t create new discoveries and new technologies, but it sure helps. Several years ago a cartoon showed a board of directors meeting, with the chairman pointing to a chart indicating a steady decline in sales and saying, “I don’t understand it, we make the best buggy whip in the country.” Only companies with a vision will invest a high percentage of their sales dollars into R&D. A shortsighted president, or one who doesn’t expect to be around long, will concentrate on the short-term profit picture to the detriment of future profitability. Learn where the company you’re researching stands compared to others in the same industry.
Large and small companies each have their advantages. Large companies may offer higher pay and more security but may cause you to become overspecialized. Smaller companies typically offer greater opportunity to handle varied responsibilities and work on a project from start to finish. Companies under 20 employees account for only about 20% of all employment, but nearly 70% of the new jobs created in the last ten years. Don’t be fooled by stereotypes or even your own experience. Don’t say “I’ll never work for another big company, you’re just a number.” Even big companies are divided into divisions, branches and departments. What you experienced may have been peculiar to that company, and would not be true of other large companies.
Stability and security go together. Large, more established firms tend to be stable. In times of recession they have good lines of credit to help survive the rough times. Stability can be measured in many ways: How regularly has the company made a profit? Has it always paid dividends? How many chief executive officers has the company had in the last few years? Have there been wild fluctuations in profits? Are employees loyal and do they tend to stay with the company for a long time? The number of CEOs a company has had tells a lot. Such changes can have a tremendous effect on long-range planning and policies: one CEO believes in dress codes, the next one doesn’t; one CEO insists on total corporate secrecy while the next tries to keep employees informed; one CEO hates unions with a passion while the next accepts them as partners.
Some companies are famous for their training programs. Merrill Lynch, for example, has trained a high percentage of the stock brokers in this country. Going to work for a company which provides thorough training can be especially helpful in your career. Employers will recognize you received solid training and this will make you more desirable. While valuable, don’t assume that such formal training is the only factor to consider. Smaller companies may not be able to send you to the San Francisco headquarters for three weeks of training, but they may provide excellent on-the-job training.
Training that is intended to help you advance is valuable. This can take the form of tuition reimbursement at local colleges, sending employees to training centers run by the company or a national training firm, sending employees to local seminars, bringing in outside consultants for training, or utilizing in-service training. Commitment to training is a good way to test a company’s commitment to its employees and to its own future.
It’s nice to work for a firm that invests in its employees. Some companies will pay for tuition only if the course is directly related to the job, while others are more liberal. The amount can range from 50-100%, usually on the condition that you pass the course. Some companies strongly encourage their employees to use the program while others are rather reluctant.
Greater than average turnover can signal serious problems with the job or the organization. Find out how many people have held your position in the last five years and where they are today. Twenty to thirty percent annual turnover is not unusual. If five people have held the position and two were fired and three quit, I think you might have reservations about the job. Find out why they were fired and what caused the others to quit. Why weren’t any of them promoted? Generally you would save your question until the second interview and then simply ask, “How many people have held this position in the last five years?”
If the employer simply gives a number, without elaborating, follow up with, “Why did they leave?” If several have been promoted within the company that’s obviously a good sign. If more than one person was fired, ask for the reason. You may determine that the factors causing the others to be fired might get you fired as well. Suppose the employer says, “They just didn’t learn the job quickly enough.” At that point it might be best to drop the subject, but make a mental note of it. Later, when you’re offered the position, ask the employer to elaborate on the cause. A little probing might show that the training program is ineffective and that two very intelligent people were fired due to no fault of their own. Perhaps the company has exceedingly high demands and quickly drops people if they don’t demonstrate rapid progress. If you’re the type of person who learns thoroughly, but perhaps more slowly than most, what are your chances?