February’s annual Business Issue of Security Sales & Integration features my cover story on Xentry Systems. I spent a couple of days with executive leadership of the business spun off last year by access control manufacturer Matrix Systems, and so needless to say I ended up with a lot of terrific information. Here in the first of a couple of blogs, company President & CEO John Nemerofsky explains how the company has quantified a means to keep its technical personnel engaged.

How do you incentivize your technical people to be the very best they can be for the business, customers and themselves?

Nemerofsky: We had just put in place … we’re five months in now with this initiative. Mark [Ring] and I were locked down for a couple of days developing incentive plans for technicians, project managers and engineers, which weren’t easy to do. When we looked at our technicians first, how do we incent them? What would be a good incentive?

We came up with the plan to incent them on three things we thought were mostly important. Thirty-percent of their annual bonus would be based on efficiency in the field. So a job sold with 160 hours on it, can you deliver it in those 160 hours? Second is utilization, which is important to us. A technician has 40 hours to work in a week. How many of those hours did he utilize to projects or service calls? We want that number to be close to 100%. Third, and most importantly, is customer satisfaction. Then we had to come up with a way to measure that. Now on each install and service call the customer gets a quick Web link from us to say how did we do? Would you refer us to someone else on a scale from 1 to 5? It takes a second, but they get it on every service call and every installation. That links to that technician by project number. That’s how we’re incenting the technicians. And each of those categories is 30%, 30% and 40% weight.

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Incentive to the project managers comes in a similar way. We want them to hit their start and end dates on the project. That’s a big deal to us. When were you supposed to start and when were you supposed to finish? Second, we want them to hold the margin. If it was sold at a 38% margin, we want it delivered within plus or minus three points there. You could buy the product better, could maybe get a subcontractor to give you a better price, or you could be more efficient with your technicians in the field. Third is utilization, so we want them to work their 40 hours a week, and how much time is being put to projects.

The engineer incentive, what do we want, we want quick turn of projects that come through engineering. So sales hands a project in, how quickly can we get it back? Hit the finish date. Estimate to close, to whatever you estimated, we want it to close at that so you estimate it right. And again, utilization rate. They’re incented to stay, so it’s a tough one to walk away from because you have this big chunk at the end of it.

We also put everybody through what we call OPR, operational personnel review. A lot of smaller companies don’t have time to do annual reviews. This is a quite involved process. The employee evaluates himself. And then the manager evaluates him, and you put them side by side and say how did they do. They can get a grade anywhere from an A1 to a C3. Your A1s you want to promote and take to the next level. Your C3s you want to maybe help find a job elsewhere, and coax them out of the business. The employee knows where they stand. They know what raise they’ll be getting in that coming year from their evaluations. I think how do we stop the turnover there, the same thing starts to happen. It’s camaraderie internally, good reviews, fair compensation, good communication. Make it a good place to work. And that hook at the end is if you’re here and doing your job you get your incentive.

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