An Amazing Transformation
John Heaton is something of an early riser. The president of Kennewick, Wash.-based Pay Plus Benefits, often begins his day at 4:30 a.m., giving him a full two hours of study and preparation before his employees even walk in the door. Heaton dedicates much of this time to looking at workplace issues. He says that by preparing in the early morning, he sees fewer problems on his desk throughout the course of the day.
Chief among his concerns is ensuring that the employees of this 13-person professional employer organization have the resources necessary to be successful – even if the solution comes with a heavy price tag. For example, the firm recently purchased a new $3,200 printer that allowed his employees to better produce training manuals for customers. And, in 2003, the company implemented an Internet-based customer management system that has helped employees better handle customer calls. "I did not hesitate in authorizing the $12,000 purchase," says Heaton. "Now, after four months of use we already are seeing increased productivity."
"In the past, it was not uncommon to hear my staff struggle with a process or a tool that wasn't working properly," he explains. "They would spend hours developing work-arounds and I often wouldn't know about it. Ultimately, this unproductive time eats away at employee morale."
Involving his staff in big decisions is another thing Heaton has been doing for a long while, a practice that has served the organization well during tough times. Premiums for benefits, unemployment insurance and workers' comp have skyrocketed in recent years. Due to the company's focus on employee leasing, small businesses that were once attracted to Pay Plus Benefits' services were backing away as their costs increased, Heaton says.
To solve the problem, Heaton worked with employees to transform the organization, expanding its original comprehensive services outside the state of Washington. Instead of labor-intensive customer service models, including hand delivery of payroll, services were delivered via customized Web-based Resource Centers, developed in-house by the IT team. From there, a market developed for the Web-based data warehouse technology that they had created – customers who did not need payroll service, HR support or benefit administration, but needed access to their payroll data and information. The decision was then made to move even further from a specific geographic market area with a "bricks and mortar" mentality to a "virtual" company with Web-based technology service.
"Once we identified these factors, we started the process of reassembling the remaining pieces for only those services whose costs could be controlled," says Heaton. "Three years later, the result is three new products that are growing faster and will contribute more profit than our original product." This development of these "Employer eTools," as they are called, is helping to build new strategic relationships with companies that understand the benefit of using Web-based products as an enhancement to their services rather than seeing them as a competitor, says Heaton.
Furthermore, the Employer eTools are being utilized by over 26,000 clients and 385,000 employees across the United States. These are clients whose payroll is not processed by Pay Plus Benefits, but is imported and available through the technology and subscription service that is the company's new business model.
The company's commitment to engaging employees in key decisions has proven beneficial to the 13-person professional employer organization. It's part of the reason Pay Plus Benefits has lost just one employee in the last three years. Better still, the company's gross profits increased 27 percent from 2002 to 2003, a figure, Heaton says, is a reflection of his employees' commitment and tenacity.
"John acts on our ideas 100 percent of the time," says Albert Torres, director of IT. "He has changed the course of the company and the ideas have taken off."
Part of ensuring success for the company means tracking the success of the staff. Heaton, however, often turns to less traditional methods of measurement, because while facts and figures are critical for running a business, he doesn't believe they tell the whole story.
Among the things he tracks is how often employees come into his office to talk about their accomplishments. "People who are dissatisfied don't have the same passion, pride and excitement that 'fulfilled' employees have," Heaton says. "People who are dissatisfied typically don't come and talk to me at all."
Additionally, Heaton measures the noise level and the amount of activity in the office. "I've learned that when my employees have time to laugh and play, they are happy and ultimately delivering the type of service that we promised our customers," Heaton says. Happily, the volume level in the office has increased in recent years and that is music to Heaton's ears.
Company: Pay Plus Benefits
Web site: www.payplusbenefits.com
Industry: Professional Employer Organization (HR, Payroll and Benefit Service Provider)
Location: Kennewick, Wash.
Number of employees: 13
Sales: $1 million to $5 million
