Frank Stronach Stops Unions With Employee Loyality

'From the very beginning, Stronach believed every employee should own a part of the company and they do, making Magna a unique model of success. Without the benefit of unions, all employees enjoy job security, benefits, pensions, competitive wage packages averaged to the competition and a share in corporate profits.' - CBC Life and Times

When I read how Frank Stronach kept the union out of Magna by treating his employees with respect through a competitive wage package with so many benefits it reminded me of someone I met years ago who owned 5 Midas Muffler Franchise stores and had to fire every single employee in one day. He learned a valuable lesson at that time that I never forgot; pay your employees well and they will be loyal and trustworthy to you - they will not steal you blind.

He and his accountant had picked up on business losses connected with inventory going out and lack of appropriate cash coming in to match. After further investigation including fake customers planted to catch the culprits he was amazed to find that at all his stores he was being robbed by all his employees and managers. In one day he brought every person into his office and fired them one by one. Leaving the managers to the end the last manager said, "well you can't fire me, you have no one left to keep your store open." His response was, "oh yeah, you're fired too!"

He shut all 5 stores and spent the next few weeks rehiring new managers and employees. This time he paid them more than the competition. He introduced cash rewards for a profitable month and annually, every summer, brought all his employees to his house on the lake for their family to be entertained with food, drinks, and water skiing all day long. These employees loved him and his business has never been stronger.

As entrepreneurs we remember the sacrifices we made to build our business and therefore we feel we deserve all the rewards. This way of thinking may cost you your business. Give back to your employees and you will build a stronger and more profitable business. Remember that the next generation of your business is now in the hands of your human asset. They can make or break what you worked so hard to create.