Winning Workplaces is a not-for-profit organization founded by one of the families who owned auto parts manufacturer Fel-Pro, Inc., which was nationally recognized for its innovative people practices and outstanding financial performance.
Winning Workplaces was established to carry on the legacy of Fel-Pro that made it No. 4 on FORTUNE's 1998 list of the "100 Best Companies to Work for in America." The Lehmans, one of the families that formerly owned and operated Fel-Pro, gave startup funding through its New Prospect Foundation.
The Lehman family firmly believes that Fel-Pro's longstanding commitment to positive people practices contributed significantly to its consistent success in outperforming industry financial benchmarks and in winning its major customers' highest service awards.
They've created Winning Workplaces to combine the lessons learned at Fel-Pro with the examples of other successful companies. Winning Workplaces will assist small and midsize employers to make their workplaces better for people and better for business.
Left to right: Winning Workplaces Founding Vice Chairman Paul Lehman, Founding Board Member Elliot Lehman and Chairman Ken Lehman.
An Interview with the Founders: Winning Workplaces and the Fel-Pro Legacy
"We're appealing to the leaders of small businesses and not-for-profit organizations on the basis of enlightened self-interest, not on the basis of a moral or ethical imperative. The data proves that great workplaces outperform average ones."
- Kenneth Lehman
Chair of Winning Workplaces and former Co-Chair of Fel-Pro
The mission of Winning Workplaces is to help organizations create great workplaces. It is the direct descendant of the values and culture that helped define auto parts manufacturer, Fel-Pro, one of America's most generous employers and one of the most profitable companies in its industry. From Fel-Pro's founding in 1918 to the sale of the company 80 years later, four generations of family owners believed steadfastly that doing right by their employees was not only just, but also made sound economic sense. Winning Workplaces provides the Lehman family, one of three families that shared leadership, a way to share the principles and practices that guided their 3,000-employee company and scores of other organizations to success. And, above all, through Winning Workplaces, the Lehmans can demonstrate that the economic benefits and other rewards from work/life practices are attainable by all organizations, large and small.
Beginning with co-founder Albert Mecklenberger's brand of open communications — walking the plant floor, knowing all workers' names — Fel-Pro's progressive people practices expanded as its work force became more diverse and as more women and single parents joined the ranks. Responding to employees' needs and concerns -- with benefits such as onsite day care and summer camp for their children, and generous in-service tuition reimbursement programs for employees to enhance their personal development -- produced demonstrable results.
Work/life benefits made up 7% of Fel-Pro's overall benefits costs, or $175 per employee annually — and, the expenditure more than paid for itself through the loyalty and flexibility that reduced costs and improved productivity. Annual employee turnover, at 9.8%, was half their industry's rate; the more important "controllable" rate at Fel-Pro was just 2.4%. And, a landmark University of Chicago study in 1993 revealed that those workers who took advantage of Fel-Pro's package of benefits were highly adaptable and responsive to change.
Fel-Pro's laudable people practices and financial record earned wide recognition: the company was regularly singled out by Working Mother magazine as one of the best places for women to work in America, and, in 1998, the company ranked fourth in FORTUNE magazine's list of the top 100 companies to work for. In the following Question & Answer session, Elliot Lehman, 83, who managed Fel-Pro for 56 years, and his son, Ken, 58, who worked for 25 years at Fel-Pro, convey how the company's culture developed, what other organizations can learn from the Fel-Pro experience, and how Fel-Pro inspired Winning Workplaces.
Organizations seeking to build better workplaces might wonder: where do you start? At Fel-Pro, two key tenets were: open communications and respect for employees. Could you explain how Fel-Pro's common sense approach developed and what lessons it holds for others?
Ken: The first step was that my grandfather walked the factory floor and knew every employee by name. He was communicating daily with everyone, which is easier to do when you are small. But, the philosophy continued. In 1947, we set up Fel-Program, a monthly newsletter, which talked about our people and their families. In 1952, we set up the Employee Forum (a monthly meeting of department heads and employee representatives) as a way to air grievances. Hours and compensation were not discussed in the group meeting. But, every issue that came up got attention. Everybody got an answer.
From the very inception of the company, the ownership and the senior management knew that nothing got done except through the people who worked there. Our product quality and service were reflections of our commitment to our employees and their commitment to us.
Elliot: We established a climate. If you came to us and had a reasonable question or complaint, we would listen, and we would communicate a response whatever the result.
Elliot, you have some examples of the introduction of other benefits that helped bind employer and employee.
Elliot: When I came back from the Navy in 1946 we found out that our offices on the Near West Side of Chicago weren't air-conditioned. We analyzed what it would cost, decided we could afford it, and so we did it. We found out that people came in early and stayed late. Productivity and morale increased. Then we looked at the plant. These people got as hot as we did. That was our starting point. Then, we asked: could we afford it? The answer was, yes. Over the years, for everything we considered, we first looked at the needs of our people and tried to satisfy them in a way that we could afford. People have personal and work/life needs, and we always tried to listen and respond.
As the workforce changed over the decades, especially with the entry of more women and single parents, how did you decide what new benefits to develop?
Ken: It's crucial to study the needs of your workforce and the ability of your organization to afford them. The major demographic change which shaped many of our benefits was women joining the workforce. That gave rise to the summer camp for employee children and the onsite daycare center.
It is important for organizations of all sizes to keep their finger on the pulse of their employees. When you are small, you can take informal soundings; once you are a certain size, you may need a formal survey of needs and interests.
Elliot: You also need to get your human resources person out into the field to find out what else is going on. You've got to get outside help. When we established the daycare center, we got professional consultants. Consulting is one of the services that Winning Workplaces will offer for smaller organizations.
Fel-Pro grew into a $500 million company with 3,000 employees. How can a smaller organization afford a complete package of work/life benefits?
Ken: The most important benefits aren't financial rewards and aren't always costly. They are based on respect, participation, etc, not money. So there aren't many benefits that are beyond the reach of small and mid-sized organizations. You can make choices, and each company should determine what it can afford. For example, an onsite daycare center like we had may not be affordable for a smaller company. But, you might be able to support employee access to an offsite center. With Fel-Pro's Better Neighborhood Fund (which donated to neighborhood organizations in employees' communities), we set a limit on how much we would contribute. The program said to our employees that we felt their neighborhoods were important to us.
Can you measure cost-benefits of each new benefit? How do you know whether there's a payback?
Ken: You can't try to quantify the bottom-line payback one program at a time. Our experience and other research show that it is the combination of programs. You also have to be committed to staying the course with a program.
Elliot: That's true. For example, take our experience with onsite daycare.
Again, this is not a program all small companies can afford. But, our approach
to the introduction of something new may hold some general lessons. When
we decided to set up onsite daycare, 82 employees said they'd be interested,
but 17 actually enrolled their children. Many employees were scared. How
could they be sure the program would be good? You've got to start somewhere
and stick with it. It wasn't long before more and more employees enrolled
their children. 
To us, introducing work/life benefits was all good common sense. But, we also knew if we really wanted to be believed and be able to spread the word, we needed some form of objective evaluation. The 1993 University of Chicago study (of the link between "family responsive policies and job performance") really demonstrated the effectiveness of Fel-Pro's programs.
How does an organization avoid cutting benefits to save costs during tough economic times?
Ken: The biggest philosophical change during my quarter century at Fel-Pro was a shift from a culture of entitlement to one of shared risk and reward. We shared our financial information, and when the external environment changed, we had to enlist our employees in the effort to cut costs. We tried to accomplish many of the same things with our benefits more economically. Instead of renting a theatre for our annual Christmas meeting to pass along end-of-year information, we made the announcements as part of our lunch program. When we faced the prospect of laying off 20% of one unit, we put everyone on a four-day week instead. Sharing the pain is the best way of doing it.
An organization has to do what it has to do, but how you do it makes all the difference. Look at how Cisco is handling layoffs: anyone who agrees to go to work for a not-for-profit will get full benefits, one-third of their salary for a year, and leap to the top of the call-back list. Obviously, Cisco is a big company. But, their attitude and approach can apply to all organizations: we are interested in retaining our talent. This tells employees who are still there that the company cares about them as people.
In 1998, the families sold Fel-Pro to Federal-Mogul. The good news was Federal-Mogul agreed, as a condition of the sale, to maintain Fel-Pro benefits for two years, and the families agreed to fund other programs, such as college scholarships, for five years. The bad news was that the financial performance of Federal-Mogul deteriorated, and benefits were eventually scaled back. What advice would you give to companies considering a sale for many of the same reasons the families at Fel-Pro did, such as globalization and industry consolidation?
Ken: If you've concluded it's time to sell, you can't rule from the grave. The buyer is the owner. The lessons learned are more at the buyer level than the seller's. Acquiring and growing through an acquisition is the tip of the iceberg. You have to really appreciate the complexity of integrating companies.
What was the motivation for creating Winning Workplaces and what do you hope to achieve?
Elliot: We knew from our experience we could make a difference, and we knew there was a lot of information out there linking work/life benefits to performance. We want to bring greater market awareness and basic understanding that treating employees well, within the ability of a company to afford it, will enhance your profitability and your own satisfaction.
Ken: We're appealing to the leaders of small businesses and not-for-profit organizations on the basis of enlightened self-interest, not on the basis of a moral or ethical imperative. The data proves that great workplaces outperform average ones.