The Patagonia story: Bringing trends to life

Summary

Patagonia's unique HR culture emphasizes work-life balance and environmental stewardship, offering on-site childcare, flexible work hours for outdoor activities, and paid leave for volunteering. They've restructured compensation to separate base pay and bonuses, and revamped performance management to be more feedback-driven and less reliant on ratings. These initiatives have resulted in high applicant volumes, low turnover, diverse leadership, and a productive workforce, demonstrating the power of aligning HR practices with company values.

Takeaways

• 🏞️ Patagonia offers on-site childcare to support a culture of work-life balance and parenting flexibility.
• 🏄‍♂️ The company fosters a culture where employees can take time off to engage in activities like surfing when conditions are favorable.
• 🌿 Patagonia encourages environmental stewardship by providing two months of paid leave for employees to volunteer after a year of service.
• 📅 A new '980' schedule has been implemented, closing the office every other Friday, to enhance work-life integration.
• 📊 Patagonia conducts pre and post surveys in partnership with a local university to understand the impact of their work policies on employee life and productivity.
• 🏆 The company separates base pay and bonuses, ensuring that employees are rewarded for both company performance and personal skill development.
• 🔄 Patagonia has rethought its performance management system to better align with its culture, moving away from traditional ratings.
• 🗣️ The company values feedback and has implemented early feedback check-in sessions to improve performance management.
• 📈 Patagonia's HR practices have led to increased efficiency, high applicant numbers, and low turnover rates.
• 👥 The company has achieved gender equality in management, with women represented at every level, including a female CEO, and equal numbers of men and women on the board of directors.
• 🛡️ Courage is emphasized as a key attribute for companies to truly support their values through HR policies, programs, benefits, and rewards.

Q & A

What is the philosophy behind Patagonia's approach to employee benefits?

Patagonia's philosophy is centered around supporting employees in their personal lives, allowing them to be parents at all times, and encouraging a work-life balance that includes outdoor activities and environmental stewardship.

How does Patagonia's on-site childcare benefit the company culture?

On-site childcare at Patagonia supports the company's culture by enabling parents to work while their children are nearby, fostering a family-friendly environment and reducing the stress of childcare responsibilities.

What is the 'if the surf is up, then go surf' policy at Patagonia?

This policy reflects Patagonia's commitment to work-life balance, allowing employees to take time off to engage in activities like surfing when conditions are favorable, emphasizing the importance of personal interests and well-being.

How does Patagonia support employees who are passionate about environmental causes?

After a year with the company, Patagonia pays for two months of leave for employees to volunteer for environmental causes, demonstrating the company's commitment to environmental stewardship and employee passions.

What is the '980' initiative at Patagonia and its purpose?

The '980' initiative involves closing the office every other Friday, allowing employees more time for outdoor activities, longer vacations, and improved relationships with family, which in turn increases overall productivity.

How does Patagonia offer a personalized benefits menu to its employees?

Patagonia provides a menu of benefits that allows employees to choose the benefits that matter most to them, tailoring the rewards to individual needs and preferences.

What was the outcome of the pre and post survey conducted by Patagonia in partnership with a local university?

The survey revealed that the new schedule had a positive impact on employees' lives, with increased time spent outdoors, longer vacations, and better family relationships, which also correlated with increased productivity.

How did Patagonia separate base pay and bonus in its compensation structure?

Patagonia separated base pay and bonus to ensure that employees receive a great bonus for a great year and have their base pay adjusted based on skill improvements over the past year, which has been well received.

What changes did Patagonia make to its performance management system to better align with its culture?

Patagonia moved away from a traditional performance management system by incorporating peer feedback, eliminating the rating system, and focusing on regular feedback check-ins, creating a more efficient and culture-aligned approach.

What impact has Patagonia's HR strategy had on its workforce and company culture?

The HR strategy has resulted in a strong brand alignment with customers, a high volume of applicants, low turnover rates, and gender equality in management and board representation, showcasing the company's courage to support its values.

What advice does the speaker give for companies looking to implement similar HR policies?

The speaker advises that companies should have the courage to support their values through HR policies, programs, benefits, and rewards, ensuring that these initiatives are in line with the company's core values.

Outlines

00:00

🌊 Patagonia's Unique Work Culture and Benefits

Patagonia's work culture is deeply embedded with unique benefits that go beyond traditional rewards and pay. The company offers on-site childcare, reflecting a philosophy that supports parenting at work. There's also a 'surf if the surf is up' policy, allowing employees to enjoy outdoor activities. Patagonia encourages environmental stewardship by providing paid leave for volunteer work. The company introduced a '980' schedule, closing the office every other Friday, which has led to increased productivity and improved work-life balance. Patagonia also allows employees to choose benefits that matter most to them, fostering a culture of feedback and continuous improvement. The company's innovative approach to performance management, including the elimination of traditional ratings and the separation of base pay and bonuses, has been well-received and has led to more efficient performance handling.

Keywords

💡Patagonia

Patagonia is a company known for its commitment to environmental and social responsibility. In the video, it is highlighted as an example of a company that goes beyond traditional rewards and benefits, embedding a culture that values work-life balance and environmental activism. The script mentions various employee benefits such as on-site childcare, flexible work hours, and paid leave for volunteering, which are all part of Patagonia's unique corporate culture.

💡On-site childcare

On-site childcare refers to the provision of childcare services at the workplace. This benefit is mentioned in the script as a way for Patagonia to support its employees in balancing their work and family life. It is part of the company's broader philosophy of enabling employees to be parents all the time, thus fostering a supportive and family-friendly work environment.

💡Work-life balance

Work-life balance is the concept of achieving a healthy balance between work and personal life. The script discusses how Patagonia's culture supports this balance by allowing employees to take time off for activities like surfing when conditions are favorable. This approach is part of the company's broader commitment to employee well-being and satisfaction.

💡Environmental activism

Environmental activism involves taking action to protect the environment and promote sustainability. In the script, Patagonia is described as a company that encourages its employees to engage in environmental activities. For example, they offer paid leave for employees to volunteer in environmental causes, demonstrating the company's commitment to environmental issues.

💡Performance management

Performance management is the process of assessing and improving employee performance. The script describes how Patagonia revamped its traditional performance management system to better align with its culture. They introduced peer feedback and eliminated the rating system, aiming to create a more supportive and efficient way of managing employee performance.

💡Compensation

Compensation refers to the financial and non-financial rewards employees receive for their work. The script discusses how Patagonia separates base pay from bonuses, ensuring that employees are rewarded for both their annual performance and their skill development. This approach is designed to motivate employees and recognize their contributions.

💡Feedback

Feedback is the process of providing information about performance or behavior. In the script, Patagonia is noted for its culture of actively seeking and valuing employee feedback. They partnered with a local university to conduct pre and post surveys on the impact of their new schedule, showing a commitment to understanding how changes affect employees' lives.

💡Productivity

Productivity refers to the effectiveness of production as measured in terms of the rate of output per unit of input. The script mentions that Patagonia's new schedule, which includes closing the office every other Friday, led to increased employee productivity. This was a surprising outcome, as the company was more focused on the quality of life improvements for its employees.

💡Turnover

Turnover refers to the rate at which employees leave a company and are replaced. The script highlights that Patagonia has 'ridiculously low turnover,' which is a testament to the company's employee-friendly policies and culture. This low turnover rate saves the company money that would otherwise be spent on recruitment and training.

💡Diversity

Diversity in the workplace refers to the inclusion of individuals from different backgrounds, genders, and perspectives. The script notes that Patagonia has women represented at every level of management, including a female CEO, and an equal number of men and women on the board of directors. This demonstrates the company's commitment to promoting diversity and inclusion.

💡Courage

Courage in the context of the script refers to the willingness to take risks and make bold decisions in support of a company's values. The speaker emphasizes that having a value is not enough; companies must also have the courage to support these values through their HR policies, programs, and benefits.

Highlights

Patagonia offers unconventional benefits embedded in its culture, such as on-site childcare.

The company promotes a flexible work culture with the philosophy of 'if the surf is up, then go surf'.

Patagonia supports environmental activism by paying for two months of leave for employees to volunteer after a year of service.

A new '980' schedule was implemented, closing the office every other Friday, to encourage a better work-life balance.

Patagonia provides a 'menu' of benefits, allowing employees to choose what matters most to them.

The company actively seeks feedback through surveys to understand the impact of their policies on employees' lives.

The 980 schedule resulted in employees spending more time outdoors and having better relationships with family.

Productivity increased when employees were given more time off, contrary to traditional beliefs.

Patagonia separated base pay and bonuses, ensuring that great performance is rewarded with a great bonus.

Base pay is adjusted based on skill improvement and market value, which has been well received by employees.

Performance management at Patagonia was restructured to align with the company's culture and values.

The company introduced regular feedback sessions and removed the rating system for a more efficient performance management process.

Patagonia's HR practices have led to a strong brand alignment with customers and a high volume of applicants.

The company experiences low turnover rates, saving costs on training and recruitment.

Gender equality is evident at Patagonia, with women represented at every level of management, including the CEO.

Patagonia's success is attributed to courage in supporting the company's values through HR policies and benefits.

The company's approach to HR is not about size or structure but about having the courage to support its values.

Transcripts

there are several ways Patagonia goes

beyond what would typically be the

traditional rewards benefits pay a part

of that's embedded in the culture at

Patagonia we have on-site childcare it's

really around a philosophy that you can

parent all the time we have a culture of

if the surf is up then go surf so we you

know allow those things to happen we

have a lot of people who want to do

things for the environment so after a

year he's been with a company will pay

for two months of leave so that you can

volunteer we recently put one in place

called 980 where we closed the office

every other Friday so a lot of our other

things that are not traditional tend to

be around how we leaning into the people

that we're hiring and what matters to

them we try to offer menu which allows

people to kind of pick the benefit that

matters most to them we never have a

lack of feedback they're very vocal but

we also asked so for example when we

implemented the new schedule we'll be

partnered with a local university on a

pre and post survey to understand how

did that impact to you we weren't just

interested in productivity we want to

send how did this impact your life and

overwhelmingly we found people were

spending more time outdoors making

longer vacations they had better

relationships with their spouse and

their children and oddly enough they

were more productive when we started

rethinking rewards at Patagonia one of

the things that we did was separate base

pay in bonus so if you have a great year

you're gonna get a great bonus and then

we look at base pay separately if you

increased your skills to market over

that past year you're gonna get in

change your base pay and it's been

really well received at Patagonia when I

got to Patagonia the performance

management system was also very

traditional it didn't match the culture

at all we looked at it we decided let's

really tap into the power of the crowd

so tap into the feedback of the people

that matter in terms of how are you

doing on a regular basis we layered in

court early feedback check-in sessions

using that feedback we also got rid of

the rating system so the combination

that changed

and performance management connected to

the changes in compensation

have really led to a lot more efficient

way of handling performance so what is

the impact of all this the actual

outcomes of HR by having this brand that

really aligns with our customers and

that we stick to we have more applicants

than we can go through typically we have

ridiculously low turnover so we don't

spend the money most people spend on

training ramped up and even recruiting

we have women represented at every level

of management including a female CEO and

the equal number of men and women on the

board of directors it really isn't about

public or private or big or small to

some extent I really think it's about

courage if you have a value and you

truly believe that is a value of the

company then you better support it

ridiculously and if you don't have a way

of supporting it ridiculously within an

HR policy a program a benefit or a

reward my question whether it's a value

you

[Applause]

[Music]

you