Compensation Force

Special Podcast: A Compensation Cafe Holiday Medley

In celebration of that "most wonderful" time of the year, my Compensation Cafe colleagues and I have gathered to produce a special Holiday Medley podcast - a festive thirty minute turn through a number of seasonal reward topics.

The Cafe Holiday Medley podcast was produced in partnership with Human Resources IQ, as part of the lead-up to their Online Compensation & Rewards Summit 2011 (January 18 through February 10), an event in which I and others at the Cafe are participating.  (Note that the early bird discount for event registration is extended through this week.)

Hope you enjoy!

Image: Creative Commons Photo "Christmas Time!" by L*u*z*A

The Immeasurable Value of Being Needed

We must never underestimate the power of being appreciated ... or of feeling needed.

Earlier this week, my Compensation Cafe colleague, Globoforce's Derek Irving (author of the new book Winning with a Culture of Recognition, your new definitive source on strategic recognition) wrote a great post on the value of saying "thank you".  Derek referenced studies from the Journal of Personality and Social Psychology which have quantified the impact of expressing gratitude on our willingness to complete a work task.  He also shared a quote, an excerpt of which I show below, on the reasons people respond as they do to being thanked.

...the experimenters found that people weren’t providing more help because they felt better or it boosted their self-esteem, but because they appreciated being needed <emphasis mine> and felt more socially valued when they’d been thanked.

People do more because they appreciate being needed.

This brought to mind a conversation I had many years ago with a manufacturing technician who worked in a plant where I had been charged with doing a wage audit.  It was suggested that I have a one-on-one with him, as he was a long-tenured employee who was widely respected by his peers.  He detailed for me, in a matter-of-fact manner, what he (and his fellow workers) felt were some of the biggest employment concerns, including the work environment in the old and poorly ventilated plant, the aging and outdated equipment, and the below-market wages.  I asked him why he stayed, when he could very likely have found a better paying job (because he was right about the wages), in a more up-to-date plant, somewhere else right in the local area.

I'll never forget his response.

He looked at me for a few seconds, then drew himself up straight in his chair and replied:  "Oh, I couldn't leave this place.  They need me here."

Certainly we should pay employees competitively for the skills they bring and the contributions they make in the workplace.  I think we are sometimes reluctant, however, to let our top employees know how important they are, how much we need them, because we feel it gives them a bargaining chip we'd rather they not have... when the truth is that this might solidify their commitment to our organizations in a way money never could.

Resourcefulness: A Core Competency for Tough Times

Many of our HR and reward programs today operate on a competency-based platform, where the fundamental building block is a set of core competencies (defined in the WorldatWork glossary as behaviors, attributes or skills that are predictors of personal success).

If ever there was an essential competency for success in today's tough economic environment, it would have to be resourcefulness.  Harvard Business Review blogger John Baldoni does a fantastic job of describing this attribute and its importance in his post The Importance of Resourcefulness.

I particularly appreciate his definition of resourcefulness as not merely a means of coping with deprivation, but rather a realization that "you and your colleagues are more capable than you first believed."  Baldoni shares a number of helpful suggestions for being resourceful that get to the very essence of this trait (paraphrased below):

Redefine the Possible.  Start with an open mind. The leader who steps up and says "yes we can do this" is one who can push colleagues to do things that some might consider impractical.

Turn Innovation Inward.  Innovation is not just about creating something new; it also applies to making old things work better.

Choose Specifics.  It may be tempting to consider ways to re-invent how your company does business. Adopting a realistic attitude about what you can do in the short term might be more productive.

Lean on Your Staff.  Conventional thinking in frugal times says stop spending, but sometimes managers conflate that mantra with "stop doing." A resourceful leader doesn't stand still and encourages staff to follow her example.

Celebrate the Lessons.  Those who are resourceful need to be recognized and rewarded, and in turn, teach their lessons to others.

Given the challenges that employers are facing today, it's hard to imagine a more valuable attribute.

Appreciation and Other Gifts for the Cash-Short Workplace

You may not be in a position to give your employees a year-end cash award, but that doesn't mean you can't show appreciation at the end of a tough year.

Compensation Cafe's Laura Schroeder has a lovely post up today about the power of a simple gesture of thoughtfulness in the workplace.  Take a moment to read it and absorb its message.  Is there someone you should be recognizing?

And for more ideas on how to say thanks on a low-to-no-cash budget, see Rosabeth Moss Kanter's column 12 Gifts for Cash-Short, Recession-Weary Workplaces at the Harvard Business Review.

For me, I'd like to let you know how much I appreciate everyone who reads and shares in the discussion here. 

My very best Christmas and New Year wishes to all of you!!

Image: Creative Commons Photo "Gifts? Already?" by mysza831

Social Media as a Reward & Recognition Tool

As social media takes an increasingly predominant place in our personal and work lives, it also raises questions about potential connections to employee motivation, performance and rewards.  I chronicled this trend in a recent post, noting the challenges employers face in encouraging productive use of social networks by their employees.

Today, Paul Hebert of Incentive Intelligence introduces an intriguing new twist on the topic.  Taking the psychological principle of social proof as a stepping-off point, Paul uses a study done to determine the most effective way to influence hotel guests to reuse their towels in order to illustrate the power of social influence in impacting behavior.

From Paul's post:

Social networks allow information to surface and let's people see what others LIKE THEM are doing - making it more likely they will follow that lead.  If a salesperson can see that other salespeople like them are making sales and finding leads - they are more likely to work a bit harder.  If your employees see others working outside their job descriptions to help the company - they will want to do the same.

Using social networks isn't just posting the top performers at the end of the program - that's still necessary.  Leveraging social networks in your program is about having a continuous stream of information that shows people are hitting targets, trying new ideas, helping other departments - reinforcing those behaviors and communicating that these behaviors are common and are standard operating procedures.

The question is whether employers, many of whom are still wrestling with the risks and control issues surrounding employee social media use, will recognize the enormous opportunity they have to leverage these tools to make a positive difference in employee - and organizational - performance.

What about you?  How can you use the concept of social influence to augment your reward programs and practices?

Employer Social Networking Conundrum: Prohibit? Control? Incent?

There is an interesting tension being played out today involving employers and social networking, with implications for employee performance and rewards.  Organizations are on a fast-moving ride, trying to come to grips with the whole Web 2.0 phenomenon and what it means for them.

Just a little over a year ago, the impetus seemed to be one of control (with the presumed undertone that social networking activities were a waste of time and drawing employee attention from their primary work responsibilities).  This is evidenced by a February 2008 survey by the American Management Association (cited here in a recent BLR Daily Advisor) which showed that 65% of employers were using Internet blocking software and, of these, 50% were blocking social networking sites and 18% were blocking access to blogs.

More recent Deloitte research suggests that employers are becomingmore aware of the fact that social networking presents opportunities as well as risks, and that managing this balance is a strategic activity.  From the Deloitte study:

• 27% of executives surveyed agree "Our executive team regularly discusses how we can best leverage social networks to our advantage while mitigating risks."

• 17% of executive surveyed agree "My company has a program dedicated to monitoring and mitigating risks related to the use of social networks."

• 22% of executives surveyed agree "My company has formal policies that dictate how employees can use social networking tools."

• 22% of executives surveyed agree "Our senior leadership team addresses issues related to company-wide social networking."

• And 80% of executives surveyed agree that social networking should be a board room issue.

It is good that employers are grasping this.  While employee networking activities undeniably raise risks, a recent study conducted by IBM in connection with MIT (via the HR Capitalist) points out that networking activity is positively related with performance, productivity ... and revenues.  Among other insights fromthe IBM study, which examined the impact of network activity via email and instant messaging, is the finding that strong ties to powerful individuals ("authorities or experts within one's network") resulted in additional individual incremental revenue of $588 a month.

Which suggests pretty clearly that employers not only need to move beyond simple control initiatives, but must consider how to encourage productive use of social networks.  Perhaps consider whether this is a skill or behavior that should be reflected in their performance management process.  And perhaps even ponder whether there should be a connection to employee rewards.

Your thoughts?

Image: Creative Commons Photo "Web" by kurtxio

Stepping Up & Intrinsic Rewards

Recently I posted about the question of whether, when and how to best recognize and reward employees who are asked to step up and take on more in the wake of hiring freezes and layoffs.

New research is out to remind us that employees themselves see such opportunities as one of the positive effects of working through a recession. 

Click over to my latest post at the Compensation Cafe to learn more.

Agility. The New Reward Watchword

There's a lot we don't know about what life will be like as we continue through the recession, or when we eventually arrive on its other side.  There's one thing we do know, though: that the business landscape will be different.  Maybe profoundly so.

Assuming this to be true, we can also conclude that success in the future (near term as well as over the longer haul) will require organizations to be quick to respond to the threats and opportunities that show up, unanticipated, in their path.  This, in turn, will demand a workforce with the flexibility to adapt to environmental demands.

Reward programs have a very important role to play in maintaining a workforce that is sufficiently fleet of foot.  This is why I believe that agility should be the new watchword for reward design.

Agile rewards are those which carefully balance fixed reward elements with their more nimble variable counterparts.  The agile reward package recognizes the importance of providing competitive base pay in exchange for a particular set of skills and qualifications (and a competent or better level of performance), but seeks to use non-fixed rewards (cash and non-cash) to accomplish most other objectives.  These other objectives might include everything from recognizing temporary project-based outcomes to addressing the increasingly frequent need for people to step out of or up above their "normal" roles in response to changing circumstances.

A picture being worth many words, I use my reward portfolio diagram to illustrate this challenge:

In the past (and still today in some sectors), it was common and acceptable to reward many, if not all, of the performance elements listed on the left side via base salary.  Agility demands that we provide a competitive base, but then - as much as possible - use other right side components to drive and recognize the results demanded of our workforce.

So .... got agility?

Image: Creative Commons Photo "Rainbow!" by Evoo73

Rewarding Those Who Step Up in Tough Times

During these times of upheaval, with hiring frozen and in the wake of layoffs, many employees are being asked (that's a nice way of putting it) to take on more.

The question becomes: Who and how to reward for this?

My answer:  Thoughtfully.  And carefully.

Click over to my post today at the Compensation Cafe for more.

Adversity Demands a Kick-Start: Try Small Goals & Recognition

In their Fast Company article Set Smaller Goals: Get Bigger Results, Dan Heath and Chip Heath, authors of Made to Stick: Why Some Ideas Survive and Others Die, make the case for smaller goals as a way to kick start performance during times of adversity.

They push for what they call "whisker goals" (targets that may be just a hairsbreadth away from the status quo) rather than stretch goals as the way to move people who are overwhelmed in the moment.

From the article:

Whisker goals are particularly well suited to our current moment. Adversity taps our strength. When you've just laid off someone, it feels like too much to bear to offer constructive criticism to another employee. When you've given up your bonus and had your budget cut, it feels like too much to consider going back for that master's degree. In hard times, we retrench. We maintain. We certainly don't stretch.

But retrenchment is the wrong response to adversity. Adversity calls for change, and change doesn't arrive via a miracle: It arrives via a kick start. During World War II, the government needed to orchestrate a massive increase in industrial production at the exact same time as its most talented industrial minds were being called away to fight. Government officials trained new people to look for tiny steps forward, not big leaps. A training manual advised workers to "look for hundreds of small things you can improve. Don't try to plan a whole new department layout -- or go after a big new installation of new equipment. There isn't time for these major items. Look for improvements on existing jobs with your present equipment."

Change can start with small measures, and it can be rewarded with small prizes. Maurer cites a Toyota employee-suggestion program. The carmaker receives 1.5 million employee suggestions every year, and it holds an annual awards ceremony to celebrate the single best idea. The lucky employee gets a fountain pen. (Lehman Brothers handed out million-dollar bonuses. How'd that work out?)

I think there's real wisdom to considering whisker goals as a way to break through the inertia that many organizations are experiencing and get people moving forward.  And I think that whisker goals combined with nominal value recognition awards (cash or non-cash) could be a winning strategy - particularly as a complement to bigger goals and annual (or longer) incentive opportunities.

Keep'em focused on the forward and the future, but help them with a nudge off home base.