LISSA’S: Higher-paying firms get better employees.

CHICO -- University of Denver business school instructor James O’Toole has a message for employers: Pay the lowest and you can expect the lowest performance.

O’Toole, who holds a doctorate, is convinced after his research and reviewing other studies that employers who say they must reduce costs by paying workers less are making a mistake.

The professor and author believes employers can’t afford to pay employees less, pointing out that they get what they pay for.

And while they may be saving money in labor costs, he believes other costs, including absenteeism and pilfering, are higher and erase any savings.

By paying low wages, companies attract a kind of work force he describes as being lower in ethics, loyalty, knowledge and performance levels.

O’Toole, whose appearance at Sierra Nevada Brewing Co. was underwritten by the Northern Rural Training Employment Consortium and sponsored by the Center for Economic Development at Chico State University, has written the book "The New American Workplace: How American Workers can Successfully Compete in World Markets."

O’Toole believes employers who try to cut their costs by outsourcing jobs are also in error.

"Customers get angry if they’re talking to someone in India and can’t understand what they’re saying."

O’Toole criticized Wal-Mart for its management decisions to cut costs, but complimented Costco in many of the same areas.

While he did acknowledge that Wal-Mart has changed its policy about certain

areas, that doesn’t qualify the retailer as a "high-involvement" company, which he considers the best model for both company success and worker satisfaction.

O’Toole categorizes as "high involvement" companies Harley Davidson, Southwest Airlines, SRC and UPS. These firms — which he says pay better — are able to mobilize a work force that is "educated and engaged."

Employers who pay more are able to attract a work force that is more dedicated to customers and creating solutions, has low turnover, higher productivity, and is engaged in assuring the company’s future.

O’Toole criticized business schools and unions for not doing their part as well. Business schools, he said, are not teaching the principles that create high-involvement companies. Unions, he said, are not being effective.

While he suggested that employees could try to convince managers and owners that high-involvement is an improvement, he said, "Bosses don’t listen that well."

However, managers and bosses may be more inclined to listen to their peers at successful companies.

source: Chico Enterprise Reord