Luckily, cash isn’t the only reward

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This article appeared in the October 2013 issue of CRN magazine.

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Luckily, cash isn’t the only reward

Imagine a workplace where everyone celebrates your achievements as they would on, for example, a sporting field. Or where you pick up points for a good job and earn enough to pick up some goods or services. Or where you are rewarded with flexible work packages, or even sent off on a training course.

These are some of the ways companies are now rewarding employees at a time when the economy is slowing down and they are squeezed for cash. This is particularly important for resellers as there is a big skills crisis in the sector. Resellers have to find ways to retain staff.

It’s not easy anymore. Pay rises and bonuses are not that easy to get now.  At the same time, unemployment is at or near a record low level. 

While the latest figures show a slight rise in the unemployment rate in statistical terms the domestic jobs market is close to full employment, providing a buyers’ market for anyone who wants to leave their job for greener fields. This puts resellers in a bind. On one hand, a slowing economy makes it harder to provide financial incentives. But companies cannot afford to lose high performers. 

They need to find ways to stop them walking out the door. Economic cycles are a fact of life. The really successful organisations are those that treat a downturn as an opportunity to refocus strategy while keeping their employees fully engaged. 

It’s widely agreed that companies seeking to retain staff need to have the following systems in place.

  • Sense of purpose: People need to feel that their work, in their own opinion, is worthwhile. When people have a sense of purpose in their work, they are more likely to stay. 
  • A sense of direction: People need to feel their work is going somewhere and also perceive that their organisation is on the right track.
  • Access to information: People need to have access to information they need to make decisions. Also, they need authority to make those decisions. 
  • Clear organisational values: There needs to be congruence, or at least the absence of a conflict between their values and that of the organisation. People should feel there is no clash between the stated and observed values of the organisation. With that, more will want to stay. 
  • Feedback: Positive feedback leaves people with a feeling of recognition. It acts as a spur for people to repeat the behaviour which generated the feedback. That creates a positive reinforcing cycle that makes it attractive to come to work each day. 
  • Development and growth: Give people more challenging roles and opportunities to test themselves in team environments. All this has a positive impact on retention rates – especially when there are a high proportion of younger managers. 
  • Good working conditions: General working conditions, if poor in terms of health and safety, do drive people to exit organisations and industries earlier than they would have if conditions were better. Research on the impact on retention of positive working conditions beyond what might be considered the norm is limited.

It is also worth remembering that money might not be the glue that keeps the best and the brightest. A survey of workers by British consulting firm, White Water Strategies, early this year found that saying ‘thank you’ often had the same impact on job satisfaction as a salary hike. The research revealed that praising staff had the same motivational kick as a one percent pay rise. 

One of the landmark studies done on employee retention was done by Kenneth Kovach at George Mason University in the US. Kovach got 1,000 employees and 100 of their bosses to list the things that they believe motivate employees. The interesting part is that bosses thought employees would be motivated by good wages and job security, but employees listed factors such as participating in interesting work, feeling appreciated at work and “being in on things.” They ranked job security and good wages as important but lower on the list. In other words, the key factors for retaining quality staff have little to do with money. It’s more about having the kind of managers that create a place where employees feel challenged and valued.

In the area of leave, some are allowing staff to take sabbaticals or purchase extra annual leave in a way where the pay cut is spread over the year and painless. Smart companies provide good maternity and paternity leave conditions.

Other inexpensive retention strategies include career planning and childcare facilities. 

Companies can also look at extending people’s careers in other ways, providing them with for example opportunities to do volunteer work for charity groups, working on a special project or serving on boards. 

The best ideas don’t have to be expensive. It’s more about good management.

Leon Gettler is a senior business  journalist who writes for a range of newspapers and journals

 

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