Doing better than the industry standard just wasn’t enough for Lauth Property Group CEO Bob Lauth-not when it came to keeping talented people on the payroll. To his way of thinking, a 35 percent annual turnover rate was unacceptable, even if that’s what his competitors were averaging. “It just seemed abysmal to me,” Lauth said. So he set out to establish a new standard, investing in employees-called associates at Lauth-and making the development firm a so-called “employer of choice” in the process. His reasoning: Getting and keeping good employees makes it easier to get and keep good clients. “It has paid a huge dividend,” Lauth said. Indeed. About five years after he launched the initiative, turnover is a low 13 percent, and the company has grown from 78 employees and $78 million in work each year to more than 400 employees and projects worth nearly $600 million.
And about a third of that business comes from repeat customers-something Lauth attributes in part to the company’s low turnover.
“The same people are here this year that were here last year,” he said. “That’s a great comfort to customers.”
The employee-oriented philosophy is gaining attention elsewhere, too. Lauth Property Group was among 50 Hoosier companies recognized by the Indiana Chamber of Commerce as a “Best Place to Work” last month.
Lauth said he has always known how important it is to treat employees well, especially in an industry that relies so heavily on people.
“There are no machines or patented widgets to get the job done,” he said. “This is a personalized business.”
But that doesn’t mean he’s always had all the answers. That’s why Lauth cast a net throughout the company to form the Lauth Leadership Committee and attended its first meeting to give members their marching orders: make Lauth an employer of choice.
They came up with “literally hundreds of good ideas,” Lauth said, from giving employees a stake in the company’s success to doing a better job with company-wide communications.
Bonuses became part of a compensation package that also ramped up things like benefits and vacations. The entire company convenes quarterly for a briefing, then adjourns to share dinner and drinks. Lauth made a commitment to training, making sure associates have ample opportunities for growth. And everyone gets a mentor-all the better to figure out where that growth might take them.
Then there are things like the on-site workout facility and the break room that bears an uncanny resemblance to a restaurant-not to mention the regular “partners’ lunches” where small groups of associates break bread with the four company principals.
“I don’t think there’s any one breakthrough thing, but collectively it adds up,” said Lauth, 55. “We made significant and rapid improvement once we made it a priority. … We’re trying to put our money where our mouth is.” The return on investment is difficult to measure, but Lauth said it’s worth every penny. “Whether the company is six people or 406, I have never ceased to be amazed by what a big difference one new person can make,” he said. “Everything can be going great and you have one more bright, energetic face come in and want to make a difference. And they do.” And that’s where treating employees well can continue to pay dividends. “If you have good, happy people who stay with you, they help recruit other good, happy people,” Lauth said. “And hopefully that will make customers happy.”
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