Why do company values matter? Why do so many companies write mission statements? What is company culture and why is it important? On this episode, Kenny Rawlins sits down with Nancy Tobler, PhD and MLM.com Editor-in-chief, to answer these questions and continue our conversation about what makes a company a great place to work.
Corporate culture is more important than you think! Direct sales companies spend a lot of time thinking about how their culture impacts the distributors in their sales force. But the values you espouse and promote are just as important for the corporate employees who keep the lights on back at headquarters.
Listen in to hear Nancy’s insights into how a company’s expressed values shape the behavior of the individuals it employs and vice versa—the ways that employee behaviors shape company values!
Kenny Rawlins: This is The MLM.com Podcast and I’m your host Kenny Rawlins. Today is the first in a series of episodes we’re going do about employee and distributor engagement. And I’m joined with Nancy Tobler. Nancy, hello.
Nancy Tobler: Hello. How are we?
Kenny Rawlins: Good. Good. So, Nancy’s obviously been on the podcast before and hosted a few of the episodes. But Nancy has a unique background that I think brings some interesting insight into this idea of distributor and employee engagement. So, Nancy, tell us a little bit about your background.
Nancy Tobler: Okay.
Kenny Rawlins: A little introduction to your experience.
Nancy Tobler: Okay. So, I’ve worked with MLM.com since (I think) 2001 so that’s been interesting work and I’ve worked in the direct selling industry and since 1999. So just a little over 20 years. And at the same time, I started my Ph.D. program at the University of Utah. I have studied organizational communication. Specifically, I study organizational change in how technology influences it.
But along with that I did a lot of broad reading and looking at the research on what employers do, what organizations do, but also what employees do and how that fits together into a complex network of effective and ineffective sort of behaviors and strategies.
Kenny Rawlins: Yeah and I think that intersection of your research as well as your experience with MLM and the different dynamics that come into play with distributors and employees does make for an interesting little miniseries about engagement and some of your thoughts and observations.
For the first discussion we want to focus on values and philosophy.
Nancy Tobler: Right. Yeah. I call it values and vision. Most companies will say they have a vision and, in reality, the vision statement is an attempt to put down in words what it is the company values. And if employees are connected to those values then that is what we want. Right? They are happier at work. They’re happier talking to distributors.
So, if you have engaged employees then companies are happier and so are the employees they’re happier. So, works for everybody. If it’s happening.
Kenny Rawlins: But I guess my observation—and tell me if this is accurate or not—is a company is going to have its vision and values that are unofficial… That may not be the official written ones but that are what people live by because it’s ingrained in the culture. And the hope would be that that culture reflects what you’ve actually written down in your vision and value statement.
Nancy Tobler: Right. You’re absolutely right. There is the official statement that is made by a company. And then there’s what they actually do. And that’s true for employees too. Right? They’ll say one thing and they do another so… companies that are great places to work… (We were just talking about great places to work today.) Companies that are good at it: their expressed values (the things that are written down in the handbook and published on the walls and you know in the lunchroom) and what they actually reward (what they actually pay heed to), if they’re the same, then it’s easier to make a connection as an employee or I would say as a distributor as well.
Kenny Rawlins: Yeah.
Nancy Tobler: I think a lot of what we’re talking about today applies to both.
Kenny Rawlins: So yeah, let’s just jump in there. What are… I mean. I guess I’m interested to hear your different thoughts on it but… Why should a company care if the employee understands their vision? And then also if the distributor force understands their vision?
Nancy Tobler: Well I guess, [laughs] I guess it all depends on if you want to stay in business. Right? If your goal is to stay in business, then you want to have clarity—clarity of purpose, and you want your employees to know that, and you want your distributors to know what that purpose is. And the big key is to reward for the behaviors you want.
We talk about this a lot on other things like compensation plans and other places in MLM. But if you want employees to be connected to your company and be happy to work there, you’ve got to reward them for the behaviors that you want.
Kenny Rawlins: Right. And I guess that. You know. Maybe a more cynical view would be “I don’t really care what my employees… If they understand the vision and value as long as they do a good job.”
What I hear you saying is “it’s less likely that they’re going to do a good job and be happy and stay with you long term, if they don’t understand that vision.”
Nancy Tobler: Yes. So. So I think we’ve talked about this before. The statistics right now… The tenure for an employee is about three years. And it takes you at least six months to a year to train an employee to work for you. So, if they’re going to leave in three years, you spent the first year just getting them up to speed.
We also know that if they’re not happy, they spend time at work looking for another job. So, they’re not doing their job to the fullest. They spend time slacking off as much as they think they can get away with.
So happy employees work harder. That’s just the honest truth. It’s good. It’s good for them. Right? I mean I’m not trying to be saying companies are exploiting their employees by making it a happy place to work. A happy place work means it’s a happy place to work. So, employees are happy. They spend eight hours a day at their job. That’s a third! A third of their time. And then another two hours commuting to that job. They spend more time with their work people than anyone else. In fact, the research says that parents of teenagers only spend 15 minutes a day talking to that teenager. So, your work family, your workmates, they are your mates. They are the people you spend day in day out with.
And if they’re happy, your bottom line is better off.
Kenny Rawlins: Yeah.
Nancy Tobler: That’s the truth.
Kenny Rawlins: I think that is interesting because… I’ve lately been on kind of a Pre-Great Depression history kick and… it is interesting just hearing… (I’m reading a book about John D Rockefeller right now) and it is interesting to hear (not specific to Rockfeller but just from that time) how people viewed workforce so differently.
Nancy Tobler: Oh yeah.
Kenny Rawlins: And this appreciation that this isn’t only a conversation about “the right thing to do” but it also makes sense for your bottom-line perspective.
Nancy Tobler: Right.
Kenny Rawlins: Because it does impact that. So, I am curious, how do you think these ideas… how have you seen this applied specifically to MLMs and particularly with a distributor force.
Nancy Tobler: So, the two things that I wrote down that I think direct selling companies, MLM companies do well are philanthropy and product vision. And philanthropy is if you decide to give back to your community, as a direct selling company, that’s your value. There’s no way to say it any stronger than that. If you decide you’re Avon and you’re going to support breast cancer awareness and breast cancer research, you’ve just said “I value women.” Plain and simple. Because that’s the disease for women, right? I mean men get it but it’s certainly a disease that women get.
If you’re Xyngular—we just had a great podcast with Russ Fletcher—if you’re Xyngular and you are looking for ways to help your distributors in their communities and you’re building your philanthropy around specific needs… I can even. This is just such a powerful concept. What you’re saying is “our distributor force matters.” So, it’s not just that we’re going to give to some worthy cause. We’re going to give to a community that’s got flooding because our distributors live there. So, it has this twofold effect. Right? It has this effect of saying “we value helping others.” Right? That’s the general value of all philanthropy. But “we also value helping others in the community where our distributors are.” Very powerful.
The other one I was thinking of that’s done a really good job with philanthropy and building on it—although I know they’re changing their process right now—Nu Skin has always had something connected to their product that also was philanthropy. So, I don’t know if you remember… For a long time, they gave research for skin diseases because they had skin care products. So, it just made sense to them that they ought to be in the business of helping researchers find cures for diseases of the skin.
There’s our value. We value our product and we value our product enough to support what our product does. That’s just incredibly powerful.
Kenny Rawlins: Yeah and that makes sense. As any company really, if you’re listening to this, you’ve got to ask yourself “okay. How are we translating what we say our vision and value is into actions?” That would be the take away there, right?
Nancy Tobler: Yeah. You have to decide. Just again we were talking about great places to work today so I read through the DSN 2018 list, and Team National—they have a list of seven or eight different nonprofits and they have time periods when you can just go ahead and instead of work. You go to that nonprofit and donate your time there.
It doesn’t have to be a single thing like breast cancer awareness, like Avon did. You could simply decide to give back to the community where your headquarters are and have that be as diverse as your employees. It doesn’t have to have a single vision to be seen as a company that cares. That’s what you’re trying to show is “we’re a company that cares.”
Kenny Rawlins: Yeah. Going back to that episode we did with Russ Fletcher from Xyngular, one of his big points was that they don’t have a single one thing that they do. They address it need-based and case by case. And I think that in some ways can be almost more engaging because it shows the constant evaluation by management and by leadership to say, “hey here’s a need and here’s how we as a company can help.”
Nancy Tobler: Yeah, there’s always an interesting phenomenon: Did it come from the bottom up or did it come from the top down? And those things that come from the bottom up can be incredibly powerful. Obviously, things that come from the leaders can be powerful too. But we often forget that just a little thing like fantasy football. Right? A group of co-workers will put together fantasy football. If that mushrooms through a company, it can create its own little cultural effect. Right? The same thing is true with Xyngular. They’re letting the distributors—not the CEO of the company—decide where the money goes. So that’s incredibly powerful. It’s coming from the bottom up instead of from the top down.
Kenny Rawlins: Yeah. No. That is interesting to think about. So, then the other one you mentioned is product.
Nancy Tobler: So, we’re an industry that… You just can’t… I can’t even think of a company. I tried to think of a company who started without a product vision. Maybe there are some in there and they failed and I don’t know about them. But we’re an industry where the reason people started the business was because they saw a need and they found a product that filled a need. And they told a story about that.
So, one of my favorites is Shaklee. Shacklee’s one of my favorites. Shacklee started out with organic, green, clean products right. That was their whole goal was to provide clean vitamins and minerals and supplements as well as clean dish soap and laundry soap. Way before it had anything to do with all of these companies now. You can’t even touch a company now that doesn’t have something they say about them being green. Right? They all say it now. But 1950s, when Dr. Shaklee started his company, it wasn’t even on the horizon. Well maybe there was a book or two. The Silent Spring had been written in the late 40s but, early 50s, it was still pretty novel to talk about. And he built his company on this idea that we have to take care of the environment and take care of ourselves at the same time.
Kenny Rawlins: Yeah and that is fascinating… your observation that the successful companies in this space, there is a story and a set of values and a set of principles. Almost always. Like you, I can’t think of any successful company that doesn’t have that behind them. I’ve worked with a few startups where they had the mindset that the product didn’t necessarily matter. But those aren’t companies that make it, right? And as much as we talk about—and my entire career has been focused around—compensation plan and analytics and things like that, the reality is this industry (while the business building and the income opportunity is a big part of it) if you don’t have a product and you don’t have this set of values and principles, you really don’t have anything in this industry.
Nancy Tobler: Yeah.
Kenny Rawlins: And that is interesting.
Nancy Tobler: Yeah. Well let’s talk about compensation for just a minute. Talking about another company, Amway—DeVos and Van Andel (I believe) were the ones that started Amway and they had this vision that you could pay multiple levels deep. And early companies that were in direct selling paid one level—maybe two levels but you made most of your money off retail sales. And then along came Amway and they said, “no. I think we can make money off of helping people run their own small business.” Right? “So, we’ll pay them to work with their teams and we’ll allow that to be multi-level compensation.” And they changed the industry.
They went through some tough times in the 70s where they had a couple of laws that changed the industry—like the 90 percent rule. You have to take back 90 percent of product so that people weren’t garaged qualifying. And Amway took the heat and survived it. And they’re one of the top companies in the world still today. So, product vision and compensation vision are two areas that are unique I think to our industry.
Kenny Rawlins: Yeah and even that compensation vision though… A lot of times I’ve seen it be more most successful when it is built on a kind of a principle-based approach where you’re helping other people, where you’re creating a team atmosphere, and you’re helping other people build the business. And there’s a mentoring component. And that really comes through in the values and principles that a company embodies, right?
Nancy Tobler: Yeah.
Kenny Rawlins: Yeah that might be a good place to stop.
Nancy Tobler: Okay.
Kenny Rawlins: I Don’t know if you have anything.
Nancy Tobler: No. That’s… I was just going to say that companies… Leaders can do a lot, but you have to recognize that employees also do a lot. They change your company. They change it without you even knowing it’s happening. So, you can do a lot as the leadership, but you also need to keep your eyes on what’s happening inside your company—both for the good and for the not good—so that you can either facilitate it or try to get away from it.
Kenny Rawlins: I think that is an excellent point and this will be a good point to close on. If you’re a person who has just listened to this episode and you’re in leadership. I think that that is a good message, right?
I mean… Like your point about the organic culture and the bottom up mentality… If you (as a leadership team or as a sole owner of a company) aren’t paying attention to the messages that you’re both distributor field and your employees are sending you, then you’re missing out on a huge opportunity.
Nancy Tobler: Right. Exactly.
Kenny Rawlins: And I think that that is an excellent point. Well Nancy we appreciate your time and we look forward to continuing this conversation on engagement over several of these episodes.
Nancy Tobler: Great. Great. Thank you.