We are co-employers in that we manage the daily activity of our people, while they take care of the HR.

As a seasoned business owner, I believe that employees want to perform well at their jobs.

It took me about 15 years to build my team of smart, qualified, empowered individuals. The youngest is 21, the oldest is 43. The age spread was not by design, but seems to have provided a benefit to our company.

As we ended last year, my partner and I began discussing the upcoming employee review process. Our PEO suggested a 360 process to provide feedback to managers. All employees working in the same office submit a short-form review of all other employees (see the form).

The PEO manages this process by ensuring forms are returned in time for review. The PEO then sorts and reviews each form for each employee. The result is a snapshot of each employee's strengths and weaknesses, according to her team members.

The PEO then breaks down these forms into one-page evaluations that it reviews with agency owners. The process is anonymous and our employees view the PEO as the custodians of the information. My partner and I never see the evaluations of each employee, just the summary.

Read a previous column, “The Beauty of a $100,000 mistake”

Sharing the wealth

Each employee travels through “seasons.” At some point, even the rock-star employee has an event outside of work that takes away his focus: the death of a loved one, divorce, or a host of other issues. Life happens, and to think that these issues will not affect an employee's work is a misguided.

For this reason, my partner and I started a quarterly profit-sharing program based on the employee's 360 review. Although the minimum is pretty small—and we only guarantee $500 for our 10 service staff employees—we want to reward those who shine each season.

Every employee is reviewed for their past season's work and we split a minimum of $500 based upon the reviews, allocating the money to each person based on his or her work. No single check is the same; one person might get $75, while another might get $10. Our goal is to always offer as much as we can and the agency has awarded as much as a $10,000 “award pot” after a strong quarter.

The employees never know how much their peers receive, and we're firm about them not sharing that information. If whining or bickering becomes a problem, the profit sharing program will be killed.

Related: Read “Customer Service vs. the Black Box”

Team-building exercises

Quarterly team building is essential to the continued development of a team. A few years ago I took my office to a camp that had a climbing wall, team building stations and a manager that facilitated our day. My father stayed in the office and answered phones. In the morning and afternoon, we all checked our messages, making sure there were no emergencies.

We started early morning with a tennis ball and about 10 pieces of rope. We had to figure out as a team how to pick the ball up using the rope and a rather large washer and then move it 10 feet to an open container. I was amazed at some of the creative ideas from  my teammates.

Now that we have two offices, team building is more important to us than ever. Our two offices are separated by about 90 miles.

After the merger of our offices, we equipped both with large flat-screen TVs, cameras and a PC. We installed Skype to pull both offices together for video meetings.

In the future, we plan to send a few employees from one office to the other and vice versa to keep the teams bonding together and eliminate the “them-versus-us” attitude that can become prevalent in multiple-location companies.