Souped-Up Air Force Suggestion Box Pays Off

The Air Force discarded its employee suggestion program last October. The program wasn’t a failure--in fact, it was so useful that the service wanted to figure out how to make it bigger, simpler and even more lucrative to its contributors.

Air Force officials put their heads together and came up with a program they dubbed Innovative Development through Employee Awareness (IDEA).

“There was some discontent in the field about the old system,” said Cathy Nealy, IDEA program manager. “It was paper-driven; there were so many process steps, so many delays.”

So the Air Force automated it, revised the suggestion process and revamped the reward system at a cost of $3.4 million, which will be spread over the next few years. That might sound like a lot of money, but the Air Force says it’s tiny compared with the $213 million in money-saving suggestions the program generated last year.

The Air Force isn’t alone in rediscovering this low-cost, low-tech approach to improving the way an organization is run. After two decades of such trends as quality circles and “total quality management” programs, many companies are looking for a little thinking out of the box--the suggestion box.

Suggestion boxes, quality circles and total quality management programs run on the same currency--employee feedback--but the usual approaches can be costly and of mixed value, workplace experts say. So companies are going directly to the source and asking workers what they think.

“Suggestion systems are making a comeback,” said Charles Martin, an associate professor of marketing at Wichita State University and co-author of “Employee Suggestion Systems: Boosting Productivity and Profits.”

“Thirty years ago most companies had some sort of program, but they would only get one legitimate suggestion a month. The systems coming out now are computerized, professionally managed and have real incentives,” he said.

According to the Fairfax, Va.-based Employee Involvement Assn., they’re also paying off. An association survey of 6,000 companies that use suggestion programs concluded that the businesses save an average of $6,224 for each idea implemented.

Manufacturers make up the majority of suggestion-system advocates, though many service businesses are starting to jump on board, Martin said.

Suggestion programs are simple: They offer employees some way to submit whatever ideas they dream up. The rationale is that workers are in the best position to see where something could be improved, in every area from health and safety standards to what kind of vending machines might work best.

Martin said the suggestion box might work even better in the ‘90s, when workers are often better trained than their predecessors and consider themselves empowered to make decisions.

“Typically, today’s workers are more educated than in the past,” he said, and “companies realize that people on the front lines often know more about what’s going on.”

“A side benefit is you get employees to think like managers,” Martin said. “It’s a grooming mechanism for future supervisors and managers.”

There’s another benefit for workers too: money. The standard reward is 10% of the money that a suggestion saves in its first year of implementation, to a maximum of $10,000, and a flat fee for successful ideas with unquantifiable benefits, Martin said.

Instead of cash, some companies give employees points for each useful idea, with the goal of encouraging workers to keep coming up with ideas. Generally, the points can be exchanged for gifts, such as luggage or office equipment, with more-expensive gifts costing more points.

Managers normally are exempted from these programs because it is their job to make suggestions, Martin said, but sometimes they receive rewards if one of their subordinates turns in a winning recommendation.

Over the last three years, the Air Force has doled out an average of $3 million a year for suggestions that have saved the service an average of about $221 million a year, Nealy said. She cited one example in which an employee saved the Air Force $60 million in unneeded aircraft repairs.

Lockheed Martin Corp.’s Federal Systems Division in Gaithersburg, Md., has what it calls the Cost Effectiveness Plus Program to solicit employee recommendations.

The program encourages workers to submit ideas, online or on paper, by awarding points for each implemented suggestion, spokesman Thad Madden said. Employees can build up points and turn them in for a variety of gifts, including calculators or sports bags. Occasionally, the division also pays out cash awards ranging from $50 to $150, Madden said.

“We encourage employees to suggest improvements,” Madden said. “It can be about how to run the company, a suggestion about decision making or an improvement in software development. We know that the person making the suggestion has a certain level of expertise.”