“Employees who become part owners of the company they work for undergo a mindset change about their role in its success,” according to Maqui Parkerson, AVP Labor Relations at Union Pacific (UP).
Writing for the Class I railroad’s “Inside Track” blog, Parkerson explains that employee ownership improves engagement, and a “higher level of engagement leads to motivated and happier employees, which leads to safer operations and better service.”
On May 13, UP shareholders approved an Employee Stock Purchase Plan (ESPP), which is now part of the railroad’s “engagement toolbox.” Active employees can elect not only to receive wages, but also to “build additional wealth by taking part in the company’s upside,” Parkerson says. “As owners, employees will have a vested personal interest in seeing the company prosper because they will benefit directly from dividend payments and value appreciation over time.”
“Over the past couple of years, UP has made significant improvements in productivity under the mantle of PSR [Precision Scheduled Railroading],” Parkerson says. “Railcars move faster, assets are more productive, and our network is more resilient because of those improvements. Arguably, PSR principles haven’t really changed the levers that drive efficiency—lean operations are still lean operations after all. But they have challenged the way our operating managers think about productivity, which has been a powerful change agent.
“Changes in the mindset of our general workforce also are required if our company is to remain competitive in a future of automated trucks, additive manufacturing, and service levels tailored to customer demand. And that can be a challenge for a mature company in a mature industry.” But new ways to engage employees can help, she notes.
The ESPP is just one example, and it “embodies our ‘Serve, Grow, Win, Together’ strategy by aligning stakeholder interests in the long-term success of the company,” Parkerson says. “I am excited about what we will accomplish with higher levels of employee engagement aligned around the same objectives. Such alignment will ensure we continue ‘Building America’ long into the future.”
(Employees should consult with their financial advisors before participating in such a program, Parkerson points out.)