Even though I am not teaching full-time MBA classes in the summer, I do have the opportunity to meet with Kellogg Alumni groups and give presentations in various Kellogg Executive programs.
Last week I met some of the members of the San Francisco Bay Area Women’s Forum. We met at a restaurant at Pier 1.5. Unfortunately, the power went out five minutes into my talk. However, it was clear this inconvenience was not going to slow this group down. Despite the chilly SF evening weather, we stood outside in a circle by the bay for an engaging dialogue covering a host of leadership issues and challenges before I took the redeye back to Chicago.
I also had taught in the Sasin EMBA International Residential Program. The class consisted of 50 senior Brazilian executives spending a week at Kellogg. The group was highly engaged as we covered various topics in leading a global company. It was interesting to see that Brazilian executives share many of same global challenges as US executives…….tariffs, people development and engagement, inflation, and dealing with extreme political polarization.
Finally, here is a link to my latest Forbes article, and copy of the full article is below.
I hope you enjoy the last full week of July!
Ending Unlimited PTO Doesn’t Solve Underlying Workforce Issues
Bolt, the e-commerce technology company, recently reversed its policy of offering employees unlimited paid time off (PTO) and now requires “mandatory” four weeks of vacation. The reason, CEO Ryan Breslow explained, is that “when time off is undefined, the good ones don’t take PTO. The bad ones take too much.”
Based on my forty-five years in the corporate world, including as chair and CEO of Baxter International, I question whether this change addresses two underlying workforce issues that the Bolt CEO alludes to in his quote.
Too Much Vacation Is A Performance Issue
First, the so-called “bad ones” taking off too much time is a performance issue, which limiting PTO will not change. Whether someone is off for two weeks, four weeks, or six weeks a year doesn’t change the fact that they are not meeting expectations. The only remedy is honest and frequent feedback between managers and their direct reports.
One significant benefit of giving continuous feedback is that it minimizes and, ideally, eliminates anyone being surprised to learn that they are falling short of performance standards or that they are simply in the wrong job. However, when these people receive open, honest, and direct feedback on an ongoing basis, they know that the job is not working out. In many cases, they will leave before being fired.
Equally concerning are the “good ones” who aren’t taking enough PTO. Clearly, there is no performance issue here; in fact, they’re probably exceeding expectations. So why aren’t they taking vacation? It could be that the workload is so heavy, they fear falling behind if they are out for more than a few days at a time. If so, then it’s up to managers to ensure that there is a plan in place to support people in taking off time from work, whether asking others to pitch in or adjusting timelines to ease the pressure.
More problematic is the perception, implicit or explicit, that top performers don’t take vacation. This is a culture issue, and it’s common to many high-performance organizations.
A case in point, a few years ago Goldman Sachs implemented an unlimited PTO policy for senior bankers. The move seemed contrary to Goldman’s hard-driving culture. In fact, according to the New York Times, “the bank’s move hasn’t led to much cheering at a place where employees build their careers on being available to clients anytime, anywhere. Goldman, in particular, has long prided itself on that ethos — so much so that its leaders rarely use all their holidays and often forgo out-of-office messages.”
In other words, simply telling top performers that they can take their vacation doesn’t mean they will — especially if it goes against the culture.
No Vacation Is Not A Badge of Honor
I’ll never forget the conversation I had with someone who told me, with pride in his voice, that when he retired he had 19 weeks of accumulated vacation. That’s nearly five months of vacation time not taken! Another friend told me it had been “16 months since I had more than one day off.” The exact number — 16 months — made me think she was keeping score.
Making Vacation A Priority
Throughout my corporate career, I worked very hard. However, no matter what my job title and responsibilities were I always took all of my vacation days for the year. Of course, I wanted to spend those days with my family, while also devoting more time to seeing friends, exercising and engaging in leisure activities, and self-reflecting. In addition, I recognized that vacation time actually improved my performance. I also knew that, whether I was the manager of a small team or the CEO running a company with 50,000 employees, when I set the example of taking vacation, people noticed and did the same.
Getting away and “unplugging” from work helps avoid burnout—a problem that is on the rise in the U.S. affecting two-thirds of people, according to one study. In addition, research shows that people who take time away from work reap significant health benefits. New research published in the Journal of Applied Psychology emphasizes taking several days of vacation at a time results in “psychological detachment” and increased physical activities “may be the most beneficial for improving employee well-being.”
You’re Not Irreplaceable—And That’s A Good Thing
Taking vacation helps you avoid the “I’m irreplaceable” trap, which can stymie your career. To explain, consider a scenario I’ve witnessed many times. Two managers, Henry and Beth, report to the department head, Ralph. One day, Ralph calls the two managers, telling them he’s leaving for New York in an hour and needs summaries of the analyses their teams have been working on.
Henry springs into action. He tells the people on his team that he needs a summary, pronto! As soon as he receives the information, Henry sprints to Ralph’s office, rehearsing in his head the brilliant presentation he’s about to make that will show just how valuable and irreplaceable he is. Beth has a different approach, which is more focused on developing her team. She tells them, “Get your notes and come with me. We’ve got a presentation to make to Ralph.”
Flash forward to when Ralph hears the news that a senior manager is going to retire and needs to be replaced. As Ralph thinks about who could step up to that job, it strikes him that Henry can’t be moved because his team can’t function if he isn’t there. Beth, however, has demonstrated that several people on her team could take over for her. No surprise — Beth gets promoted.
There’s a moral to this cautionary tale: If you aren’t taking vacation because you want everyone to see how irreplaceable you are in your current job, it may be a self-fulfilling prophecy.
Vacation Is Re-Creation
You’re off for a week — going to the beach, trekking to the mountains, or even having a “staycation” to relax with family and friends. Whatever you enjoy doing, you’re engaging in some well-earned recreation. Now, think about that word for a moment. Its Old French and Latin roots point to a deeper meaning than merely “fun.” Rather, recreation is about restoring, renewing, and refreshing — even recovery.
That’s a potent incentive to take your vacation and come back to work energized.
