What if an employee's salary could be tied to the customers satisfaction? That's just what Ron Holt, CEO and founder of TWO MAIDS & A MOP™ decided to do with his residential cleaning company. To help set his company apart, he created a 'pay for performance' compensation plan for his employees. The level of the customers satisfaction directly affects the pay level of employees who clean homes for the Alabama based company. This unique compensation plan helped make TWO MAIDS & A MOP™ among the fastest growing cleaning companies in the country.
With over 50 franchises throughout the United States, TWO MAIDS & A MOP™ is now looking for a director of operations. In an all-new episode of The Job Interview, Ron Holt and franchise owner Jamie Kulaga interview potential candidates for the position, which Holt refers to as "the most important" hire in the company's recent history.
In advance of the episode, we interviewed Ron Holt about appearing on The Job Interview and found out what makes the TWO MAIDS & A MOP™ 'pay for performance' plan so unique.
What was the experience like interviewing actual candidates for a real position in your company, that you knew would be televised?
It's very intimidating because you know every move is being chronicled and taped, but as the day wore on, and it was a very long day, it became more comfortable and very work like.
It was enlightening for us because ... since it was being taped, there had to be a bit more length in some cases… I know I am pretty guilty of interviewing candidates in the past, and within a few minutes making a fairly quick decision and ending the interview fairly quickly as a result of that. And in this case we needed to make these things last a little bit longer because of the entertainment value of it. It allowed us to actually get to know people a little bit better and maybe make a decision on them that we probably wouldn't have made before.
It was a fun experience for me and for Jamie, our franchisee. We learned a lot about ourselves along the way.
You are using a very interesting compensation plan of 'pay for performance'. Is this plan unique to your company or is it practiced withing the cleaning industry as a whole?
It is very unique to just us. I started the plan many years ago, more than 13 years ago … and it was a result of desperation.
We were struggling early on in my business life and ... I said I gotta figure out a way to get our employees to care without me being this drill sergeant because I can't be inside every home every time. I had to figure out a way to scale this business beyond just me...I wouldn't be able to talk to every new customer, so the genesis of the pay for the performance plan started after reading a book called the "Purple Cow". It is just what it sounds like, if you were to see a cow in a rural area that was purple, it would be so different and remarkable that you would remember it forever.
So after reading that book, I started brainstorming and trying to create a way to create our own purple cow ... so it hit me one day that we needed to align our employee's interests with my own interests as the owner and allow customer feedback to directly control employee compensation. Every time we clean a home we give our employees a reason to care because customers are going to rate their level of satisfaction on a very simple scale from 1 to 10. It's our purple cow. It was for sure a lifesaver for the business.
What do you employees think of being compensated based on their performance? What do your customers think as well?
In terms of employees, early on it was tough. This was a whole new mindset. This was so different that it was scary to some of the early employees. In fact, we had some people quit. But overtime the culture shifted and the mindset changed, and people started accepting it and understanding it better. Nowadays, it's just a part of who we are and there are no questions asked because it is part of our culture.
Employees really respond to it well ... we have a board that provides real time feedback on all the cleanings from the previous day … it's almost like a scoreboard. People will run straight to that scoreboard to see where their ratings are.
Customers absolutely love it. That's the number one reason people hire us nowadays. People will tell us all the time how different and unique it is and how much they appreciate the fact that it proves that we really care about what they think and that they have a true voice.
Do you think a performance compensation plan could work for other businesses or industries?
I believe so, especially in the consumer services space. When you think about consumer services … I really believe the customer is the king and what they say matters. When you put the power in the hands of the customer … it allows service to reign.
I believe that it can work in almost any industry, but specifically in the consumer services space.
This interview has been edited and condensed.
Learn more about TWO MAIDS & A MOP™ on an all new episode of The Job Interview Wednesdays 10P ET/PT