As employers complain about how hard it is to find workers with the skills they need, retaining top performers becomes more and more crucial. So the question becomes, what do employees really want?
Let’s take a step back and look at the big picture.
Yes, money matters
“Employees aren’t motivated by money.”
It’s true, people will cite any number of reasons for showing up on the job every day.
They love the work. They love their co-workers. They get a sense of fulfillment from what they do. They enjoy the challenge. Their work helps the planet. They need to get out of the house.
And on and on.
But there’s only one genuine reason people work: They get paid.
That paycheck underwrites the American Dream. It pays the mortgage, feeds the kids and the dog, pays college tuitions and funds retirements.
Or at least it used to.
The recent economy has shaken employees’ faith in their economic futures. That makes the paycheck – both its size and its reliability – a huge morale/retention factor.
Used to be, the experts pooh-poohed the effects of salary hikes: “The boost in motivation doesn’t last past one or two paychecks. Then it’s just back to business as usual.”
That may well be true in the long run. But all the signals say it’s not so today.
Fair compensation – pay and benefits – is the no-brainer of retention in 2013.
Companies that offer competitive comp levels can enhance retention with other management techniques.
But if they’re not competitive in salary and benefits, it’s going to be tough to hang on to their best people.
Flexible hours and telecommuting
Two other retention-builders that have become increasingly common over the past several years: flex time and telecommuting.
Flexible schedules can benefit both employees and employers, if done correctly.
Working staggered hours can help workers with families maintain the work/life balance they need – a giant morale builder.
And in some instances, flexible hours can allow companies to be operating additional hours in the day.
That can mean more sales and better customer service.
Telecommuting can also be a win/win. To begin with, it saves employers the cost of office space and utilities.
Companies can bring on new workers who live in another part of the country without having to pick up massive relocation costs.
And in today’s wired world, instant communication’s no problem.
The details of telecommuting carry some pitfalls, of course – employers have to figure out who owns the equipment (and who’s responsible for paying for repairs when things break), specific work hours and chain of command.
But many firms find telecommuters aren’t only more productive, but they actually put in longer hours than their office-bound colleagues.
Apparently, when the commute’s a matter of steps to a home office – and they’re not subject to the normal workplace interruptions – employees find they can better concentrate on day-to-day duties.
Pay-for-performance plans certainly aren’t new.
But in an uncertain economy, more and more employers are adopting the concept as a technique to give workers an opportunity to increase salary levels.
Nowadays, most employers tie bonuses to special achievements and behaviors – not subjective judgments on workers’ performance, but specific criteria that reflect the company goals and the employee’s contribution to the bottom line.
Typical types of bonus programs:
- individual incentives
- team incentives
- a share in the gains from improvements in production and quality, and
- a share of the company’s overall profits.
One form of incentive that was common during the pre-recession years seems to have pretty much fallen by the wayside: retention bonuses.
While that may seem counterintuitive for companies worried about keeping their best performers, that particular perk has faded for a good reason: It usually wasn’t based on hard performance numbers.
Today’s companies are focused on each employee’s contribution – in hard cash.
Rewarding someone for simply hanging around another year just won’t fly in the current business atmosphere.
Little things do mean a lot. Employees love perks – because they’re not really about the perk itself, but the recognition that goes along with it.
These kinds of low-cost rewards can be almost anything. Here’s a decidedly non-exhaustive sampling:
- Tickets to sporting events and shows
- Free beverages and snacks
- Small plaques bearing the employee’s name and the date
- Gift certificates for meals
- Community service days
- Free lunch once a week
- Free car washes
- Health club membership discounts
- Continental breakfasts, and
- Holiday family parties or picnics.
There’s one more perk that pleases everybody: time off.
An extra day off to reward an outstanding job goes a very long way toward lifting an employee’s opinion of his or her company.