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SAS: Investing in Creative Capital

Summer D. Leifer

LEAD580 – Practical Problem Solving for Today’s Organizations

May 5, 2013

Dr. Lisa Haddock

Southwestern College Professional Studies

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SAS

Abstract

SAS, a global leader among analytics software companies, has a reputation as an outstanding

employer. This reputation is strongly rooted in SAS’ employee empowerment philosophy. Jim

Goodnight, SAS founder and CEO, explains, “We’ve worked hard to create a corporate culture

that is based on trust between our employees and the company…a culture that rewards

innovation, encourages employees to try new things and yet doesn't penalize them for taking

chances, and a culture that cares about employees' personal and professional growth” (SAS,

Work Environment, 2013). Empowerment is an integrated into SAS’ vision: “SAS transforms

the way the world works, giving people the power to know (SAS, 2013). SAS gives its

employees the power to know through encouraging creativity and alignment, fostering

collaboration while embracing diversity and through continual learning and educational

opportunities. Under Goodnight’s leadership, SAS’ employees are empowered to perform at

their peak performance thus enhancing SAS’ overall effectiveness and profitability.

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SAS

SAS: Investing in Creative Capital

In addition to being a global leader among analytics software companies, SAS has the

distinction of consistently being recognized as one of the best companies to work for in the world

(SAS, Employees, 2012). Its reputation as an outstanding employer is strongly rooted in how it

treats its employees and how it capitalizes on their talents. Jim Goodnight, SAS founder and

CEO, explains, “We’ve worked hard to create a corporate culture that is based on trust between

our employees and the company…a culture that rewards innovation, encourages employees to

try new things and yet doesn't penalize them for taking chances, and a culture that cares about

employees' personal and professional growth” (SAS, Work Environment, 2013). Empowerment

is an integrated into SAS’ vision: “SAS transforms the way the world works, giving people the

power to know (SAS, 2013). SAS gives its employees the power to know through encouraging

creativity and alignment, fostering collaboration while embracing diversity and through

continual learning and educational opportunities. Under Goodnight’s leadership, SAS’

employees are empowered to perform at their peak performance thus enhancing SAS’ overall

effectiveness and profitability. The cornerstone of this success is what Goodnight calls “creative

capital” (Goodnight & Florida, 2005).

Creativity & Alignment

Jim Goodnight co-authored a Harvard Business Review article with Richard Florida,

“Managing for Creativity”, stressing the importance of creative capital and how to optimize

employee and stakeholder participation within an organization through empowerment (2005).

Goodnight and Florida assert bribing employees with extrinsic rewards such as stock options will

not produce long-term and sustainable high performance and, instead, employees are more

inspired with challenging work and intrinsic rewards (2005). Echoing the same sentiment, the

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SAS

Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA) produced a

video based on a speech by Dan Pink on what motivates individuals to include what encourages

employees to pursue innovation and entrepreneurship (RSA, 2012). Pink’s premise is there are

three things to improve individual drive (especially with cognitive skill employees): mastery,

autonomy, and purpose (RSA, 2012). During the video, Pink also discusses the increasing

employee expectation for purpose-driven organizations. Purpose-driven organizations are more

likely to retain skilled employees while providing an encouraging atmosphere for

entrepreneurship (RSA, 2012). Pink and Goodnight both assert organizations seeking to

empower and inspire peak performance among their employees must encourage creativity,

provide challenging work while minimizing obstacles, and establish a common purpose

stakeholders may align themselves with. In The Leadership Challenge, James Kouzes and Barry

Posner describe the elation point people experience as they feel ‘in the flow’ operating at peak

capacity with very little perceived effort and, when they experience this phenomenon within an

organization, they are far more likely to be committed to the organization (Kouzes & Posner,

2012). After an interview with Jim Goodnight, Michael Lee Stallard, President of E Pluribus

Leaders, a leadership and management consulting firm, described the high degree of SAS

employee autonomy and how this, in turn, fueled creativity while fostering alignment (2011).

Alignment with a shared purpose and empowered creativity are strengthened through

collaboration and diversity.

Collaboration & Diversity

At SAS, all stakeholders are empowered to collaborate in building a stronger company

and, whether a customer or an employee, everyone’s voice and input is valued. Goodnight and

Florida emphasize “creative capital is not just a collection of individuals’ ideas, but a product of

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interaction” (2005). SAS has several venues through which stakeholders may collaborate with

one another. The company has its own social media site, the Hub, launched in February, 2011,

through which employees may share ideas and issues with one another (SAS, 2012).

Additionally, SAS maintains global webcasts for its multinational branches, employee generated

content on its websites, and more than 700 internal blogs (SAS, 2012). Jim Goodnight also

holds regular ‘Java with Jim’ sessions where all employees are invited to have coffee with him

and share their ideas and/or ask questions (Stallard, 2011). Furthermore, to encourage

egalitarianism and collaboration, SAS leaders maintain an open door policy and continue to do

hands-on work with their employees (Stallard, 2011). SAS employees are more impressed with

good work and unconcerned with titles or placement on an organizational chart. Goodnight and

Florida assert, “the willingness—even eagerness—of [SAS] managers to roll up their sleeves and

delve into the ‘real’ work of the organization sends an important message: ‘We are all on the

same team, striving towards the same goal of providing a superior product’” (2005). While SAS

capitalizes on collaboration, it also appreciates and celebrates diversity among its stakeholders.

It has several programs and initiatives in place to promote diversity and equal opportunity.

These programs include a Veterans Focus Group, a Women’s Initiative Network, educational

initiatives for veterans and minorities and several programs designed to assist individuals with

disabilities (SAS, 2012). Jenn Mann, Vice-President of Human Resources for SAS states, “SAS’

strength comes from its culture which is rich in diverse people, talent and ideas. Our collective

strength and passion for what we do drive innovative solutions that solve the most complex

customer problems” (SAS, Work Environment, 2013). SAS empowers its stakeholders through

embracing diversity as a key component of collaboration. To further reap the benefits of

collaboration and diversity, SAS is committed to employee development.

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SAS

Employee Development

With a PhD in Statistics, Jim Goodnight is committed to continual learning and personal

development. SAS’ website for employee recruiting states:

In particular, education is our passion–one that comes from our academic roots and philanthropic mission that we, as corporate citizens, have an opportunity to positively impact the educational process. We are proud of our company’s contributions to improve education and excited about future efforts that will continue that tradition (SAS, Work Environment, 2013).

SAS maintains a culture of learning and empowers its employees through numerous training

opportunities to include leadership development, sales, interpersonal development and technical

skills (SAS, Employees, 2012). Since SAS understands intrinsic rewards are more powerful than

extrinsic rewards, it takes advantage of opportunities to strengthen employees’ mastery of their

skills. For example, it sends developers to industry- and technology-specific conferences so they

may hone their skills (Goodnight & Florida, 2005). Additionally, it stages its own R&D expos

and encourages employees to author white papers, articles and books so they may showcase and

share their knowledge (Goodnight & Florida, 2005). Through providing continued learning

opportunities and experiences, SAS invests in its most valuable resource—its employees. In an

article published by Baldridge.com, “A Culture That Values Employees,” Jim Goodnight is

quoted as saying, “Knowledge-based companies need knowledge workers. Looking at services

that keep employees motivated, loyal, and doing their best work as merely expenses and not an

investment is, I think, a little shortsighted” (Baldridge, 2011). SAS invests in and empowers its

employees through providing and encouraging continued development, training, and education.

Conclusion

Goodnight has repeatedly asserted that his leadership style is not complicated and,

rather, it is rooted in common sense. The employee-focused philosophy that has been in place

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since SAS’ founding in 1976 is based on Goodnight’s assertion: If you treat employees as if they

make a difference, they will make a difference (SAS, Work Environment, 2013). Through

encouraging creativity as an integral part of its operations and working to align employees

personal and professional lives, SAS has enjoyed a significantly lower voluntary turnover rate of

2.2% in an industry typically experiencing 20% or higher (Baldridge, 2011; Stallard, 2011).

Likewise, as SAS empowers its employees through collaboration initiatives and takes advantages

of employee diversity, it strengthens its overall performance and has even managed to maintain

profitability during turbulent financial times (Baldridge, 2011). Finally, SAS understands the

importance of fueling employee motivation through providing for opportunities to master skills

and increase job knowledge thus resulting in superior products and services. Through applying a

seemingly simple philosophy, Jim Goodnight has created an empowered company where

individuals feel valued, appreciated and aligned with their work.

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SAS

References

Baldridge. (2011, February 22). A culture that values employees. Retrieved May 4, 2013, from

Baldridge: http://www.baldrige.com/criteria_workforce/a-culture-that-values-employees/

Goodnight, J., & Florida, R. (2005, July). Managing for creativity. Retrieved May 4, 2013, from

Harvard Business Review: http://hbr.org/2005/07/managing-for-creativity/ar/2

Kouzes, J. M., & Posner, B. Z. (2012). The leadership challenge (5th ed.). San Francisco:

Jossey-Bass.

RSA. (2012). Drive: The surprising truth about what motivates us. Retrieved from Youtube:

http://www.youtube.com/watch?v=u6XAPnuFjJc

SAS. (2012). Employees. Retrieved May 4, 2013, from SAS, Corporate Responsibility:

http://www.sas.com/company/csr_reports/current/employees.html

SAS. (2013). Company. Retrieved May 4, 2013, from SAS:

http://www.sas.com/company/about/index.html

SAS. (2013). Work Environment. Retrieved May 4, 2013, from Careers:

http://www.sas.com/jobs/corporate/index.html

Stallard, M. (2011, January 21). Has SAS Institute’s Goodnight Cracked the Code on Corporate

Culture? Retrieved May 4, 2013, from Michael Lee Stallard:

http://www.michaelleestallard.com/has-sas-institutes-goodnight-cracked-the-code-on-

corporate-culture

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