Jason Redlus: Can you start us off by taking us through your background?
Razor Suleman: I am completely unemployable and therefore I had to be an entrepreneur, because nobody else would hire me. I’m only half joking, but I have been an entrepreneur since I was 15 years old. This is my fourth company and I’m very passionate about this. If you’re ever teaching executives about what you need to build a great company, that ultimately comes down to people, and when we think about how we can help organizations, a lot of companies say that people are their greatest assets. But how do we actually get employees to be successful, productive, engaged and aligned to the company goals in order to achieve those goals and meet expectations? So that’s sort of where my entrepreneurial journey led me.
So how did you end up starting Achievers?
Our mission is to change the way the world works. When I started the business, I looked around the workplace and wondered why do we start at 9 and end at 5? And a lot of those questions go back to our roots in the industrial age. Many of the things that we do in HR are an anachornism that in this economy that doesn’t apply anymore. There are so many things that I felt were challenging in the workplace, so I wanted to create a company that focused on today’s workplace.
Gen X and Gen Y make up 60 percent of the workforce; they are the future generation. But if you think about how social has changed us as consumers, and how we communicate and collaborate, then why don’t we build software that is as easy to use as Facebook and as engaging as some of the consumer tools that we use? Why does it have to be really difficult to install and require six weeks of training to use? We really believe that a consumer education of the enterprise is the future of how businesses are going to connect, how they’re going to communicate, how they’re going to engage the employee and ultimately drive performance. And that really was about looking at all of the ways the world works and changes.
Because let’s face it, we’re all going to spend a good part of our lives at the workplace versus anywhere else, and there’s not many bigger places that you can make an impact. How do we change the way the world works so that you can look back and see how you’ve made it a better place and made people better off? That’s what we’re really excited about, and while it may not have been as obvious when I started the company, it’s clearly why Achievers exist today.
“It’s a great feeling working for a company that not only says that people are the most important assets, but actually lives it and breathes it and empowers them. When you empower employees, you let them tell you who are the star performers, who deserves more reward and recognition for their contributions.”
What’s a typical success story when a company partners with Achievers?
One that I can share publicly involves Eli Lilly, which, like most pretty evolved companies, understands the service value chain. Basically, we all exist as employees of a company to generate shareholder return; that’s how we measure how effective we are as an organization. The shareholder return is the output, and if our share price goes up and our earnings-per-share, those are all outputs. And they strongly believed that to change the inputs and have happy repeat and loyal customers, they needed to grow revenue. What causes happy, repeat and loyal customers? Happy, loyal, and engaged employees, which are the ultimate input to business success, or what we call employee success . Focus on that first and the rest will take care of itself.
We partnered first with Eli Lilly Canada, which according to employee engagement surveys was in the bottom 10 percent of the 137 Eli Lilly affiliates around the world. As you would expect, their profits and customer satisfaction were lower. So they brought in a new world-class leader, a former executive of P&G who they brought on as President and General Manager . One of his first decisions was to partner with Achievers, and when we came on in 2009 we listened to their vision and understood what they wanted to do. It aligned perfectly with what we believe, so we started to put those things in place.
After a year they had made a lot of those changes that you need to focus on, like defining culture and values, putting the right people and leaders in the right seats, focusing on engagement and performance with employees. And after that first year into our partnership, they went from being at the bottom 10 percent of employee engagement globally to being number one in the world. We’re very proud of the results, which again came out of executing on how business does work: first having happy, loyal and engaged employees, which leads to happy customers and shareholder value. That’s what we want to do every time.
What were some of the tactics that the leadership team did in partnership with Achievers that played a role in that turnaround?
It always starts with leadership first, so we got introduced to Michael Mason the new leader. He had to make some tough decisions about putting people in the right seats, because you have to have leaders who believe in employee engagement, especially if you’re a knowledge and service-based business. That’s the first thing that we observed. Then they kind of went back to their roots and what helped them build this great company. They focused on culture and on their values. Most companies have their core values on a wall behind the reception desk or something, and most people probably couldn’t even find them much less live by them. So he took it off the wall and put it into the company, but instead of telling the leaders, “Hey you own the values, you need to practice them,” he gave it to the people. He put it in the hands of every employee and said they would help foster a culture of recognition, of living your values and ultimately driving employee success. And he enabled this peer-to-peer system of recognizing each other for living these values every day, and it was awesome to watch as it got 90 percent or more usage and adoption inside the company.
It’s a great feeling working for a company that not only says that people are the most important assets, but actually lives it and breathes it and empowers them. When you empower employees, you let them tell you who are the star performers, who deserves more reward and recognition for their contributions. If I were to give management one piece of advice in this regard, it would be to let your employees own this and let them decide. Don’t try to push this down from the top. Eli Lilly Canada followed this advice, and honestly it was magical to see their quick turnaround within a year to become one of the most profitable companies in the world.
Would you consider your company a “disruptive innovation”?
First let’s talk about our business. Our mission is to change the way that the world works, so we’re really focused on recognition and engagement and performance of your staff. That’s been around for 100 years. Way back in the Henry Ford assembly-line era, they invented cognitive service awards, because at the time when people were stamping out widgets on an assembly line, engagement and discretionary effort didn’t really matter. The best employee and the worst employee are only differentiated by about 5 percent, because they’re both doing the same thing over and over. But in the knowledge and service-based economy, people’s creativity, innovation and commitment really impacts the output of a company significantly. Bill Gates famously said that the best software engineer is 10 times more productive than the average software engineer, and in a knowledge-based economy, anything that produces 10 times more has a significant competitive advantage. I should add that he also said be nice to nerds because one day you will end up working for one.
So let me paint a picture of where this all started a hundred years ago. Back then they said, “We’re going to reward your presence if you show up to work, because your performance doesn’t matter, and if you stay for five years we’ll give you a grandfather clock. If you make it all the way to 10 you get a crystal vase.” We all have these programs in our companies. Big companies have service awards like catalogues. You pick between this stuff that nobody wants, and if you make it all the way to 25 years you get the gold watch. That is a symbol of success in the industrial age, but that doesn’t resonate with Gen X or Y. As far as they’re concerned, who’s going to stay at the same place 25 years?
So when I think about disruptive innovation, we came in and said that while we should celebrate someone’s time on a job and recognize service to the company, we should put all of our efforts into rewarding performance rather than presence. We believe in a world where the best people get a greater share of the reward, and we want to make sure that people can make an impact on day one and be rewarded financially for their contribution. We’re not going to make it time-based and top-down, we’re going to make it ground-up and performance-based. And while that might seem like a very simple concept, 93 percent of American companies still run traditional service programs that reward presence. We’re going to change that.
We run some of these traditional service rewards programs too even though we hate them, because these companies make us when they buy our whole suite. But after the great recession hit it in 2009, that was the first thing that people started to cut. So we did this huge campaign called RIP – Rest in Peace traditional service rewards. The recession started to kill them off because they were costing too much money.
Now getting back to disruption, we’re going to change the inertia in corporate America through innovation. For instance, we created this now Gartner-recognized category of Social Employee Recognition Systems. We pitched Gartner to put it on their hype cycle for years and finally Gartner put it on like eighteen months ago. So we now have a little dot on Gartner’s hype cycle. That was created at Achievers; we invented social recognition and real-time employee engagement check-ins.
Engagement surveys go out once a year. Why can’t we check the pulse and the temperature of our employees on a more frequent basis so that if they have an issue, we can deal with it? Let’s deal with the smoke and not the fire. That’s kind of how we think about it. We look at all of these antiquated HR practices and ask if they were to be created today, would you do it the same way? And we wanted to swap those old practices for innovative ways of creating new practices more aligned to today’s workplace.
Is there a threshold on employee size or employee population? Does every company qualify for Achievers to work with, or is there a certain type of company size, industry, etc?
When you talk about industry and size, generally speaking where we find the greatest impact are with organizations with 1,000 employees or more. That’s not to say that it can’t work with 200 people, but the pain with an organization of more than 1,000 people regarding the complexity, the communication, the values and the purpose of the organization is the greatest, and that’s where we can help.
We’ve also found that the most successes involve companies where people really are the differentiator. So let’s look at professional services. If you asked me 10 years ago when we started this what would be the number one vertical that you could penetrate, you would say accounting firms right? We’ve got companies like Deloitte, and PwC, and I thought accountants would buy this because they’re very value conscious. They could use Achievers and think, “I can put less than 1 percent of your total compensation and I’m going to get this magical lift in performance. You’re going to try harder; you’re going to be more engaged and going to be more connected to the business. And I can give you a 1 percent raise.” You’re going to be insulted, right? So they found this really cheap, effective, low-cost, high-impact way of doing it, and that’s why all of those firms bought our solution. And that extended to other verticals.
I’ll give you some examples where people are the differentiator. Call centers are very people-heavy, and the tech community has really embraced it. Financial services involves bits and bytes of money going around, but it’s really people at the branches that are helping you, so they have been wonderful to us. We’re starting to see a huge surge in retail, and last year we launched CVS, the world’s largest pharmacy with 202,000 employees. We never would have thought that would be an ideal fit for them, but they heard of our approach to business challenges and what we’ve solved for other companies.
So we serve very people-powered businesses. Having said that though, we have moved into manufacturing for companies like Iron Mountain. 3M is an amazing success story as well; I knew they were innovative, but since most of their employees are in manufacturing and in unions I wondered if this really was going to work in that environment. They‘re not in front of a computer. Our customers who really believe in it, really make it a part of their business and ingrain it in their culture, find ways around some of those limitations. For instance, people have smartphones, so while CVS doesn’t have computers for all their staff in retail, 35 percent of their employees access our software through their smartphones. So we think the biggest innovation in our business is going to be the proliferation of smartphones in every employee’s pocket.
So how do you use your own product? How does Achievers use Achievers?
We believe in drinking our own champagne, so we’re obviously super-users. From the number one tool I mentioned, which is peer-to-peer recognition, we empower every employee. There was a book called “First, Break All the Rules” by Marcus Buckingham in the Gallup organization, which did the largest study of its kind to look at what makes a great manager. One of the 12 things that managers do is that they give recognition weekly. So we thought if the world’s best leaders do this, we want our staff to act like the world’s best leaders. That’s why we gave them all a vote. Every week they get to pick one person and award them 500 points, which is only worth $5 for living the Achievers values. We have eight very descriptive values, like focus on customer happiness, or share, care and be fair, and we let our employees decide. I don’t even pick, everyone in the crowd picks, and it is the most utilized tool. It’s amazing to see how strongly it correlates to what we know are our strong performers and what are not. So that’s the number one tool we use and we highly encourage it.
We also use our own survey tools, mobile products and run campaigns like employee referral campaigns for our application. We do call center contests, we run sales incentives through the application, we run service award programs, performance, reward, recognition, incentives engagement, etc. That’s really what the product was built to do, and we use it a lot. Achievers has grown 80 percent year-over-year for the last five years, and while I’d love to say that it’s all because of our product, I think a lot of it is because of our beliefs and the fact that we live and breathe and act like a company that wants to change the way the world works. We don’t leave it to the status quo. So we built software that we can put into large enterprises that are based on what we’ve seen actually work at either Achievers or other great companies, and we productize those so that every company has access to those same tools.
Is there an administrator of the system who provokes all the things that you mentioned you do? Who makes sure they actually get deployed?
We’re only going to engage with a customer when they have C-level buy in; it can be the CEO or the COO who really believe that if they focus on engaging and improving the performance of their employees, they’re going to improve their business success. So we need to hear that and see that they’re actually trying to do it. Then they usually have executive sponsors that help facilitate the decision-making process and are the internal champion. But ultimately it’s usually someone with the title like Director of Total Rewards, VP of HR or Director of Employee Engagement.
Every big company has someone in the HR function that is focused on engagement, performance, total rewards and sometimes internal communication. This is our customer, those who run and own the program every day. But the software’s automated; it actually runs itself. So think of it like Facebook inside your company, without all the chatter. Instead of spending time using Word and Excel and trying to bandage up a program to do what we do, now they have the software tools and can spend more time on the analytics. Where are they winning, where are they losing, how is this region performing versus this region? So they’re really studying the data.
We can roll this out to 7,000 CVS locations, and some of the businesses will take off and improve while the other ones may not have adopted as much. The successful ones will be spending more of their time doing strategic-level tasks now because the information is there to understand their business, because it’s hard to know what 200,000 people are doing. When I think about it, I don’t even understand what companies did before Achievers to know what’s going on and who’s doing what.
Razor Suleman is the founder and chairman of Achievers, a company that is passionate about Employee Success™. Achievers helps engage employees and inspire performance globally through employee recognition software and services. Razor founded his first company at 15 and has proven his vision and drive through his subsequent business ventures, culminating in Achievers. Razor is a winner of BDC’s Entrepreneur of the Year award.
Razor graduated from Wilfrid Laurier University’s School of Business and MIT’s Entrepreneurial Master’s Program.
Jason is Argyle Executive Forum’s managing member and founder. Argyle Executive Forum is a professional services firm that convenes and connects business leaders from highly targeted business-to-business communities for strategic collaboration and business development.
Over 40,000 executives participate in one or several of Argyle Executive Forum’s communities, with over 700 new members joining every month. Prior to forming Argyle Executive Forum, Jason launched the private-equity business effort for Capital IQ. Capital IQ was acquired by Standard & Poor’s in 2004. Prior to Capital IQ, Jason was an investment banker, focused on middle-market M&A and LBO transactions. He holds a Bachelor of Science from Cornell and an MBA from Harvard Business School.