Morning Advantage: Why It Pays to Pay Your Employees Well

It’s a common strategy to cut labor costs in order to increase profit margins — plenty of companies do it routinely. But Sophie Quinton at The Atlantic points to several companies that are turning that equation on its head, proving that the decision to offer lower wages is a choice — and not a necessity. She cites the examples of low-cost retailers such as QuikTrip, Trader Joe’s and Costco Wholesale, who have found that paying their workers more actually pays off in the form of increased sales and productivity. The average American cashier makes $20,230 per year — which is below the poverty line for a family of four in a single-earner household. In contrast, entry-level employees at QuickTrip get an annual salary of around $40,000 — with benefits. And while its competitors have spent the recession floundering, QuickTrip continues to grow.

On the flip side, underinvestment in workers can lead to operational problems in stores, which ultimately decreases sales. Quinton points to Borders and Circuit City as prime examples of what happens when you devalue your workers: “Both big-box retailers saw sales plummet after staff cutbacks, and both ultimately went bankrupt.” Instead of thinking solely of high-level employees as the talent you need to pay well in order to help grow the company, Quinton argues that paying entry-level employees a solid living wage can help the bottom line, too.

THE NURSE WILL SEE YOU NOW

Nurses Can Practice Without Physician Supervision in Many States (The Washington Post)

Nursing groups around the country are pushing for legislation that would allow nurses with a master’s degree or higher to order and interpret diagnostic tests, prescribe medications and administer treatments without physician oversight. If they succeed, the number of states that allow nurses to practice without a physician would jump from 16 to 30. While physician groups are adamantly opposed to the legislation, citing concerns about patient safety and quality of care, the nurses have won the support of faith-based organizations, social workers, patients’ groups, the National Governors Association, and the National Academy of Sciences’ Institute of Medicine. Starting in 2014, insurers will be required to pay nurses the same rates that they pay doctors for the same services — which further encourages the creation of nurse-run practices. Judging from the number of comments this Washington Post article is getting, it’s a hot-button issue that’s got doctors, nurses, and patients alike up in arms.

GETTING TO “AHA!”

The Right Ideas in All the Wrong Places (Booz & Company)

Booz & Company partners and strategy experts Ken Favaro and Nadim Yacteen offer this advice for companies that want to innovate more strategically: First, you need to break your strategic challenge down into distinct components. Then, you can create a matrix of proven solutions for each piece of the puzzle in your strategic challenge. Finally, link the connections between the proven solutions to help uncover your own “Eureka!” moment. Easy, right?

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