Formal Mentor Programs to Build Strength for ESOP companies: UPDATED
Sarah A Scala, M. Ed & OD, ACC
Estimated Reading Time: 4 Minutes
For those who are not familiar with Employee Stock Ownership Plan (ESOPS), these are companies that give employees ownership interest in the organization. ESOPs are much more than a retirement plan. When organizations are set up as Employee-Owned, a trust is formed that purchases some or all of the shares of the company.
This structure generates tax benefits for the company and establishes a culture of shared ownership. ESOPs provide employee-owners with educational opportunities, shared data on performance, increased business literacy, and enhanced employee involvement. By involving, educating, and informing employees in day to day business operations, this "ownership culture" builds innovation that leads to bottom line improvement and strengthened performance.
A few of my clients, including King Arthur Baking Company and Chroma Technologies are ESOPS. I have also been an employee of an ESOP, Hypertherm, that is 100% employee owned. Because employees are owners of the company, they have a say in how the company is run. I find that when I work with my ESOP clients, they have a strong commitment to both the performance and culture of their organizations!
Mentor programs are a natural fit for ESOPs, as they can support continued development and knowledge sharing of ownership culture. I have designed successful mentor programs for ESOP clients that have resulted in a strong Return on the Investment. Formal mentor programs can provide tangible benefits to ESOP organizations and their people. I have designed mentor programs to reduce turnover, strengthen cultural immersion for new hires, develop high potential leaders and talent, and as a development tool for succession planning. Mentor programs also help to build inclusion and belonging for organizations.
Example of a Formal mentor program for my ESOP client
Resource Systems Group (RSG) is an ESOP management consulting company that offers transportation planning, market strategy, and custom software development services. RSG hired me to build a mentor program to support the development of their high potential leaders. I designed the framework and structure of this mentor program, including all the resources to support RSG to manage this mentor program internally. This included creation of a custom:
Mentor Reference Manual
Mentor Guide
Mentee Guide
Mentor Agreement
Feedback Assessment
“Sarah is a valuable organizational learning partner and advisor to our company. One of her particularly valuable recent contributions included developing materials and resources that provide the framework for an internal mentoring program. Sarah excels at applying best practices to specific organization learning needs. Her approach includes customized, innovative and practical programs.”
Roles in a Formal Mentor Program
It is common to have a steering committee in place to oversee and advise on a formal mentor program, with a Program Administrator often designated in larger organizations. There is the mentor and mentee, as well as the supervisor of the mentee. Designing an effective program with these resources helps to ensure that the program will be effective and have a positive return on the organization’s investment in time and money.
Steps for Formal Mentor Program Design:
Get commitment and sponsorship
Be clear about objectives
Define the management and structure
Budget
Recruit or identify mentors
Training of Mentors
Accountability
Evaluation
When not the right match, best to end soon
The three states of a formal mentor program often include Initiation, Setting Expectations / Developing Partnership, and Terminating or Sun-setting the relationship. Some organizations have mentor programs with as little as 90 days of time, while other programs may last 1-2 years, depending on the specific objectives and organizational needs.
Mentoring Partners Well With Talent Management Tools
Mentoring may serve as a tool for on-boarding new talent. Using a 70-20-10 development plan, the 20% portion is allocated for mentoring. Mentoring is often used in the development of high potentials by executives or in succession development. The higher up in the organization a leader moves, the less likely they will be able to find a mentor internally. For this reason, external mentors are often used in these cases. Lastly, mentoring can be used as a part of performance management.
Results: Mentor programs that I have custom designed:
Reduced turnover by 88%, built morale, and increased skills for front line staff
Successfully on-boarded new hires into the business culture
Developed high-potential employee-owners
Increased apprentice speed and quality in manufacturing
Supported succession development of high potentials
ESOPS, with their structure of employee-ownership, benefit from mentor programs in order to share their cultures, build employee retention, and strengthen skills!
Let’s connect to discuss building a successful mentor program for your ESOP!
Workshops
Sarah Scala hosts facilitated workshops on mentoring in businesses for teams and organizations of various sizes.
Check out my short Mentor blog posts:
Positive Use of Power: Mentor Programs Strengthen Culture and Produce Strong ROI
Questions from the Maine HR Convention Keynote - Effective Mentor Program Design
Peer Mentoring - An Effective Way to Help you Grow in your Business Career
Informal Mentoring - A Great Way to Build Skills and Culture for Your Business
Questions? Let’s connect. I would love to hear your success stories. Please send them to: hello@sarahscala.com or visit www.sarahscala.com
Sign up for our Newsletter here for great articles, tools, and top blog posts
About the Author:
Sarah Scala is a senior talent management leader and executive coach with 20+ years of experience providing organization development, change management, and leadership development solutions for diverse global and local industries. She is a collaborative consultant, coach, and educator supporting performance transformation of executives, leaders, and teams. Sarah is a methodical, results-driven leader recognized for helping clients reach their highest potential, increase revenue, reduce turnover, elevate business profitability, build competencies, and improve performance.
Privacy policy: I do not rent, sell, trade or share your email address with anyone, ever.
©Sarah A Scala Consulting
All rights reserved. Excerpts and links may be used, provided that full and clear credit is given to Sarah A. Scala Consulting with appropriate and specific direction to the original content.