De Zeeuwse Stromen, the Netherlands: Make work pay – make work attractive
De Zeeuwse Stromen, a hotel and conference centre, has initiated an employee bonus system. Employees work in autonomous teams and the owners function as coaches. This approach is based on profit sharing and has proved successful for both employees and the hotel.
De Zeeuwse Stromen is a hotel and conference centre on the Dutch coast. The hotel comprises a restaurant, swimming pool, sauna and fitness centre and caters to business meetings and private holidays. The hotel employs 43 people in permanent positions. In addition, there are 14 trainees and 13 stand-by employees. The workforce is not highly skilled, is relatively young and about 50% are female. In the late nineties, the hotel (bankrupt at the time) was bought by the present owners. They had two objectives for their business: to be the best hotel on the Dutch coast and to achieve a high level of job satisfaction for their employees. After losses in the first year, annual sales increased from four to five million euros, and the profit margin increased from 8% to 12%. Employees work in teams that have a high level of autonomy. Since employees have a say in almost all matters concerning the company, they decided they had no need for a works council. A works council was present some years ago but has since been dissolved.
Description of the initiative
The initiative is successful because of the personal approach of the hotel’s owners, which have placed employees at the centre of attention in order to achieve the business targets. To meet their goals, the owners of Zeeuwse Stromen decided to create highly autonomous teams. The owners themselves act merely as coaches.
- teams perform a number of tasks, for which they bear full responsibility. First of all, the teams have to set up their own specific contribution to the strategic goals of the company. The team chooses its own leader. This is a dynamic process, i.e. the function of the team leader rotates within the team. In addition, the members take care of the recruitment as well as the dismissal of team members. An evaluation process within each team and in conjunction with other teams is conducted on a daily basis. Hence, the overall autonomy incorporated in this approach is very high.
- obtain objective evaluation tools, the teams use four methods: ISO-system, guest surveys, employee’s satisfaction indicator and a quarterly evaluation. The quarterly evaluation determines the level of each employee’s bonus in the profit-sharing system. The four methods are most powerful in conjunction with each other; the multi-stage approach from different perspectives helps to eliminate bias in the evaluation.
- working methods are described according to, and in line with, the most up-to-date ISO-system. All products and services in the hotel are evaluated by the guests, using a 10-point scale. If the mean score is lower than 8, the cause needs to be identified and corrected to ensure future quality. The employee satisfaction indicator includes a number of factors that determine each employee’s satisfaction. Quantifiable factors, such as satisfaction with pay, terms of employment, and working week, are coupled with factors such as respect, contact with colleagues, planning security, enjoyment and social participation. Finally, the quarterly evaluation allows an evaluation of each individual by the other team members. The following issues are evaluated: keeping one’s appointments, ISO/task orientation, dealing with criticism, speed of work, productivity, attentiveness towards colleagues and guests, communication, feedback, task knowledge, problem-solving, coping with stress, contribution to policy and tidiness.
The team leader’s task includes, for example, monitoring attendance at appointments and assessing quality or working conditions suggestions made by the team members. As the team leader function is part of a dynamic process, the team leader is not hierarchically superior to the other team members. Team leaders meet regularly to review appointments made among teams. Each team has its own head of quality assurance. This autonomy requires a certain attitude and behaviour. All employees, therefore, receive quarterly training to obtain the necessary skills to perform assigned tasks. Employees learn to assess their own behaviour, and to consider input from colleagues and guests, based on the principle: ‘first the guests, then the team, then me’. As a result, the employees of De Zeeuwse Stromen become more open, honest, direct, communicative and committed to their work.
In general, payment is according to the collective labour agreement in this sector. A share of the profits is paid in addition to a salary. A bonus system is used to distribute the profit sharing. Bonuses are paid individually, in accordance with quarterly evaluations. A bonus can be as high as several hundred euros every quarter.
One of the most important drivers for the success of this initiative is the enthusiasm of the owners, which encourages the young employees. Although not solely dependent on enthusiasm, this attitude clearly facilitates promotion of the company’s philosophy. The business success of the company illustrates that this management approach is equally responsible for the success of the initiative. The eventual profit-sharing scheme, based on evaluation, also has the additional effect of positive feelings of mutual respect.
A consequence of autonomous teams is that undesirable behaviour is discouraged and good behaviour is rewarded. New employees have to conform to team behaviour. Team members are satisfied with this method, but it can lead to the exclusion of dissidents. For introverted people and people not used to working in teams, this method, although confrontational and intimidating at first, eventually helps them to become communicative, successful contributors to the team.
The initiative to work in autonomous teams in this company has proven to be successful. Evaluations of guests are high, as well as employees’ job satisfaction, and the profit margin is higher than average in the sector. Sickness absence is relatively low, as is staff turnover. The hotel received an award from a national tourist organisation (ANWB) in 2001.
The business success of the hotel is also good. After a first year of losses, the annual income increased from four million to five million euros, and the profit margin increased from 8% to 12%.
Exemplary and contextual factors
The organisational structure of Zeeuwse Stromen is exemplary, as the owners are successful in creating an attractive workplace by participative management in autonomous teams and by a system of profit-sharing in bonuses.
Swenneke van den Heuvel, TNO, Hoofdorp