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Appendix. Good Company Index: Scoring and Sources

Laurie Bassi Berrett-Koehler Publishers ePub

In calculating the Good Company Index Scores for the companies represented in this book, we used data from a variety of sources, which are listed at the end. (The most up-to-date information on the Good Company Index can be found at http://www.goodcompanyindex.com.)

In some categories, companies were ranked from high to low into octiles, or eighths, which were used to assign category scores that make up the Good Company Index ratings. For example, a company that falls in the top 12.5 percent (the equivalent of the top one-eighth of the overall distribution) would be in the first, or top, octile. A company that falls between 75 percent and 87.5 percent would be in the second octile, and so on.

Overall Good Company Grades and
Corresponding Numerical Scores

In order to calculate a score for a given company, we begin by measuring how good an employer it is. Using companies that have at least 25 employee reviews as of April 2010, we get a starting number based on the octile into which a company falls in Glassdoor.com’s overall ratings, relative to other Fortune 100 companies.

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3 The Social Imperative

Laurie Bassi Berrett-Koehler Publishers ePub

On November 10, 2004, the fiancée of an employee at video game maker Electronic Arts (EA) posted a blog entry. It was an anonymous, emotional essay published at a free blogging site. And it transformed the video game industry.

In her nearly 2,000-word essay titled “EA: The Human Story,” the author, who referred to herself as “ea_spouse,” spoke in personal terms about the toll long work weeks were taking on her fiancé and herself.1 At first, she explained, her fiancé’s project team was expected to work eight hours a day, six days a week. Then twelve hours a day, six days a week. Then eventually extended hours for seven days a week. “The love of my life comes home late at night complaining of a headache that will not go away and a chronically upset stomach, and my happy supportive smile is running out,” she wrote. She also argued that routine weeks of 85 hours on the job without overtime pay by game developers were illegal, ill conceived, and the product of corporate greed.

In another era, her essay might have been the sort of complaint shared merely with family and friends. Or perhaps, if she was particularly determined, she might have sent it to mainstream media outlets or a labor attorney with the hope that a sympathetic journalist or lawyer would take up her case.

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1 The Worthiness Imperative

Laurie Bassi Berrett-Koehler Publishers ePub

The Home Depot didn’t look bad on paper in early 2007. But online, I the home improvement giant didn’t look good. And the story of that disconnect gets at the heart of this book: we’re entering an age when goodness matters for companies like never before.

In January 2007, Home Depot ousted an unpopular, highly paid CEO, Robert Nardelli. And although Nardelli’s whopping $210 million severance package irked investors, the company signed a much more reasonable deal with his successor, Frank Blake.1 The Nardelli-Blake transition earned Home Depot positive press.2 And although Home Depot was suffering from the housing market decline, Blake announced a hopeful outlook in late February.

“The long-term fundamentals of our company are strong,” Blake said, “and we believe we can improve our performance and grow at, or faster than, the market beyond 2007.”3 He also outlined investments for better employee engagement, improved product innovation, and tidier stores.

But one month later, this corporate giant—which in 2006 had ranked 14th in the Fortune 100—was beset by the consumer equivalent of a mosquito swarm. The trouble started with an essay by personal finance columnist Scott Burns at Web site MSN Money. In the article, Burns lamented that Home Depot no longer held an intimate place in his life.

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8 The Good Seller

Laurie Bassi Berrett-Koehler Publishers ePub

From its origins as a shipper of valuables in the 1850s to its charge card with the famous tag line, “Don’t leave home without it,” American Express has had a long legacy of strong service. But the company left the 20th century without it. AmEx hovered in the 50th percentile for service quality during the years 1999 to 2004, according to research firm wRatings.

Like many companies, American Express was focused on cost containment. The priority was reducing time on the phone with customers. American Express’s nod to service came primarily in the form of a checklist for such behaviors as saying the customer’s name three times during a call and avoiding 10 seconds of awkward dead time on the phone.1

This not only led to a stiff experience for customers but also robbed employees of the autonomy that helps make for meaningful work. Annual turnover in its service centers, although not as high as the 100 percent annual turnover sometimes experienced in the call-center field, was nonetheless in the double digits.

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2 The Economic Imperative

Laurie Bassi Berrett-Koehler Publishers ePub

The Disneyland employees most pivotal to the famed theme park’s customer satisfaction aren’t the ones roaming around in Mickey Mouse and Goofy costumes.

They’re the folks carrying brooms.

Scholars John Boudreau and Peter Ramstad have shown that the sweepers who continually tidy up the park and often answer guest questions are vital to Disney. The caliber of these workers and their ability to solve problems are crucial to the holistic “magic” Disney aims to create for visitors.

“Disney sweepers have the opportunity to make adjustments to the customer-service process on-the-fly, reacting to variations in customer demands, unforeseen circumstances and changes in the customer experience,” Boudreau and Ramstad have written. “These are things that make pivotal differences in the ‘Happiest Place on Earth.’… At Disney, sweepers are actually frontline customer representatives with brooms in their hands.”1

The importance of sweepers to Disney speaks to the way in which consumers’ desire for integrated experiences is propelling companies to greater worthiness. For Disney to delight customers on premium-priced vacation packages, the company can’t just focus on excellent rides, good food, and friendly costumed characters. It has to make sure even the employees carrying out clean-up duties are sharp thinkers and sociable to boot. It has to recruit the right people to be sweepers, train them, engage them, and retain them—it must be a good employer.

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