While working on my new book, Profit in Plain Sight: The Proven Leadership Path to Unlock Profit, Passion, and Growth, I updated the 2015 Return on People Benchmark Report that serves as one of two catalysts for transformation. And I found a huge surprise!
A company that most of us have probably never heard of but which is patterned on Berkshire Hathaway is handily beating Warren Buffet by a factor of 5! It’s a New York firm named Alleghany that has been quietly in business for since 1929, and listed on the NYSE for over 85 years. Alleghany entered the Fortune 500 two years ago.
Their Return on People is an astonishing $328K of profit-per-employee – a B+ on the Benchmark. In comparison, Buffet’s is $62K – a C-
What’s their secret?
- They set goals and provide incentives, yet decentralize management. The Benchmark Report is the perfect catalyst to set a much higher goal than you may have imagined you could, and has the power to engage your people in being the ones whose small decisions each day will really move the needle in your business – decentralized impact at its best.
- They shun fads and fashions in favor of investing in the basics that offer long-term value. How often does your leadership team get distracted by bright, shiny objects? Having a Profit Plan such as the 5-Step plan in Profit in Plain Sight that emphasizes the basics and is clearly focused on creating value is core to achieving this level of success.
- They are clear in their vision yet agile in their execution, with the ability to ‘skate to where the puck is going’ in terms of divesting from some businesses in order to find more attractive growth opportunities. Many of the companies with stellar performance in the Return on People Benchmark have that same agility, and it most often comes from being closely connected with their customers, not from a sales perspective but at an executive level. When you can hold your vision for your company yet always find a way to address your customers’ evolving needs, success follows. The Value Creation Conversation structure in the book Profit in Plain Sight shows you how.
84% of companies will score a C, D, or F on the Return on People Benchmark, which measures how well you turn the talent of your employees into value for customers. As a result, it can be a powerful catalyst for transformational change.
Where do you rank?
To benchmark yourself against some of the best and shatter your speed limits about how much profit your business SHOULD earn, download your complimentary Report here. Then, pick up a copy of Profit in Plain Sight and implement the The 5-Step Profit Plan to double or quadruple your Return on People (safely and sustainably!) within the next year. The book is available online and at bookstores everywhere, and for less than $25 it will be one of the best investments you make in your business this year.