Fast Company article - January 1999 "Sanity Inc." By Charles Fishman Page 85 Prepared by Vince Crary 2-14-99

Working for the Minnesota Extension Service and the SAS Institute Inc. has similarities.

SAS Institute Inc. is a software company that writes statistical analysis software. Their software is used to analyze much of the statistical data researchers gather. I know SAS software is used at the Crookston Experiment Station by the researchers there.

The use of SAS software is not what this insightful summary is all about. The article focuses on the work atmosphere and the work ethic at SAS.

At SAS, the company's approach is to let their employees do their job and to provide an atmosphere people take pay cuts to work in.

The Minnesota Extension Service does not provide an excellent day care, a person to help employees find the correct care facility for an aging parent, or unlimited soda, coffee, tea, and juice, or 22.5 tons of M&M's per year to divide among employees. SAS, on the other hand, doesn't have 87 county offices as well as the St.Paul campus and the experiment stations where employees work. The Extension Service does provide excellent vacation time, along with holidays, sick leave that meets everyone's needs, and a work environment that people do take less pay to work in.

The area that I think SAS and Extension differ is in turnover rate. At SAS, the company has never had a turnover rate above 5% and last year the rate was 3.7%. The article states, "The company now employees 5,400 people world wide, up from 1900 people five years ago".

The article talks about how keeping the turnover rate low is a tremendous financial advantage to any company. "Two independent consulting companies - Hewitt Associates and the Saratoga Institute - have estimated that the cost of replacing a worker runs between 1 to 2.5 times the salary of the open positions."

SAS not only provides an atmosphere people want to work in, they bend over backwards to keep people, not by high salaries, but by realizing people work differently, dress differently, and have different needs to meet, such as family needs. Extension is similar in many respects. I know I enjoy the freedom Extension offers and so do many of my co-workers. I do feel Extension does need to do more to hold down turnover rates. SAS saves big time financially because of their low turnover rate.

Reflections: I am sure SAS employees have pressures on them; however, I found it interesting how this privately held company goes out of its way to give its employees the freedom, flexibility, and resources needed to do their job.

Discussion: I enjoyed talking with others about this article. Many said," No way!" when I told them about the SAS company, employee benefits, facilities, and work atmosphere. I can see why SAS has such a low turnover rate.

Many companies don't value the people who work for them. According to the article, a low turnover rate rewards a company financially in a big way. Maybe more companies need to utilize the SAS approach to employees if for no other reason than the bottom line.

-- Anonymous, February 14, 1999

Answers

Thanks for your comments on this article. It is always interesting to read about those organizations that have figured out that that their human resources are their most valuable asset. SAS truly seems to have done that. The information you quoted on the turnover rate is significant. I managed truck drivers for a large company, and we would drool over such a phenomenal turnover rate.

Often companies who are looking at the bottom line forget to examine the costs associated with turnover. Or they do examine the costs, but are unable to make changes that will impact turnover significantly.

Just a comment on your writing: Very well done!

-- Anonymous, April 19, 1999