Can the spread between corporate profits and employee earnings get any wider? Will it continue to grow unabated, as some have suggested, or are we heading a reversal, for a new battle for talent?
According to information published in the New York Times, corporate revenue growth has far outpaced salary increases; and as companies pressure employees to do more the productivity spread widens exponentially. It’s a trend that some business gurus say shows little sign of receding with the article’s author declaring, “with millions still out of work, companies face little pressure to raise salaries, while productivity gains allow them to increase sales without adding workers.”
All true. Most leaders don’t feel any urgency to attend to workers when unemployment remains stubbornly high. And as the pressure to “do more with less” continues to guide corporate thinking, it seems counter intuitive to invest in strategies that reduced turnover—especially when employees don’t appear to have anywhere else to go.
But know this. The productivity bubble companies have enjoyed will not go on forever. As soon as employees have more options they will exercise them. Businesses that ignore this reality, and do not take proactive steps now to reconnect with their workforces, run the risk of being the big losers when hiring heats up again.
I urge anyone that is responsible for the human capital contribution within their businesses to think long and hard about the ramifications of losing employees—especially top performers—to competitors who might be looking to close their own productivity gaps. Perhaps then you will see the argument for recognition in a different light.
In my last white paper, I wrote that smart learning and development leaders have discovered that a solid core curriculum alone isn’t enough to sustain behaviors over time. And now comes along new work from The Forum that suggests organizations are going to have a tough time training poor performers to be better if they are not already engaged at the workplace.
The study, “Training Public Sector Employees: Which Employees Gain the Most?” examined more than 500 workers to evaluate whether they believed their training—across more than 20 job functions—improved their performance. The results suggest that an organization’s focus on motivating employees—through an effective rewards and recognition program—can be an equally (if not more) valuable investment than training alone.
The conclusion sheds light on a sweeping change that I am seeing—something some are calling “holistic learning”. Here progressive training managers are finding that a combination of personalized communications, targeted learning and performance-related incentives represent the best combination to drive better outcomes—an approach that makes sense to everyone, especially the CEO.
Why is that? The skill transfer that learning and development leaders are responsible for is simply not taking root at anywhere near the pace the c-suite would like to see and business leaders remain less than pleased with the outcomes. With other studies—including work done at Johns Hopkins and PricewaterhouseCoopers—suggesting that the real issue is a lack of reinforcement—and with The Forum now suggesting that motivation and engagement are indeed critical precursors to leaning—senior management will be more open now to injecting rewards and recognition into the process than ever before.
When it comes to engaged employees how critical is senior level support? A reporter recently asked me if it was possible to improve employee engagement even when the c-suite isn’t on board. My answer surprised him when I said. “Yes it is possible”. But then I added, “But not over the long haul.” Let me explain.
At its core, engagement is very much a “localized” phenomenon. Managers who actively, consistently and proactively recognize the efforts of workers and encourage employees to use their skills are the single largest influence on employee engagement.
But in the absence of a culture that cultivates these local connections across the broader corporate experience the effect is fleeting. Cultures need to be “authentic “to be sustainable. Attitudes and actions emulating from corporate leadership must be consistent in tone and temperament to be meaningful to the rank and file. Without behavioral stability from all managers –senior or otherwise—whatever connection the employee feels to their employer will most likely be isolated to their manager.
And, of course, c-suite commitment goes beyond mere behavior. They recruit and hire managers who share their views on employee appreciation and they make the investments in the systems and technology that make the act of recognition easy. Without that level of ongoing support the chances of having an engaged workforce across the organization are very low.
If the c-suite does indeed see the competitive potential of employee engagement—and most do—then they must be active players in translating the potential advantage into a business reality.
“Monetize”. It’s the latest buzzword in business today and it reflects the corporate world’s need to get a significant return on every investment it makes. And frankly, it’s a word that should be part of every employee recognition conversation in the New Year.
How do you monetize recognition exactly? There are the obvious ways. Employee recognition triggers higher levels of engagement which in turn drives employee productivity. Engaged employees share ideas and information and tend to stay with their employers longer. In our knowledge-based economy true retention—and by that I mean the hearts and minds of employees—is worth big bucks to businesses that can sustain those connections.
Engaged employees are also more customer focused. They own issues and outcomes and have been known to please customers at higher levels than workers who are not so emotionally committed. Satisfied customers buy more and do so more often over their lives. Higher customer valuations are one more way to put a value to your recognition investment.
But for the c-suite leader the more compelling way to monetize your employee recognition investment may actually be around the less obvious benefits. Employee recognition programs motivate employees to innovate, to share best practices and to work together in a collaborative manner more so than any other HR intervention. They help to create working environments that appeal to top performers and they represent attractive places for others seeking a more cooperative and mutually focused workplace. As the business world gears up for a talent grab, being an employer of choice will save companies millions in recruiting fees and bloated salaries.
If you want your employee recognition program—including the philosophy that drives it—to stand out in 2013 (and the years to come) think about its role in monetizing people power in new and profitable ways.
Are you ready to tap into encore employees? That’s the label author Marci Alboher puts on 50+ year olds’ who are re-positioning themselves in the workforce, often morphing from one career identity to another.
In The Encore Career Handbook she points out the myriad of challenges and opportunities that await them. Some will need retaining and just about all of them will need to get used to the idea of being managed by someone who is younger and less seasoned than they are. Big adjustments await everyone involved.
But companies that do tap into their experience will be rewarded. Encores represent a newfound dimension of talent and perspective. They possess time-tested know how and they understand the connection between people and businesses better than younger workers do. They bring a welcomed level of maturity and personal responsibility to the table.
But before you add them to the fold you need to ask yourself if your recognition program is geared to unleashing that potential. Part of the answer lies in understanding what motivates older workers.
Start by recognizing their contributions as “leadership in action”. Celebrate the value of their experience and wisdom—even if it was gathered someplace else. This will flatter them and assure them that they are wanted where they are.
You should also reward them when they give back; something that may take a little coaxing until they get comfortable. Applaud their efforts to mentoring younger employees and don’t hesitate to point out any of their extra efforts—you will compliment them by noticing and at the same time reinforce the value sets germane to their generation.
This advice also works, by the way, for companies looking to retain older workers—those who may be straying emotionally as they envision their careers ending. Be forewarned: Many boomers are contemplating the next phase of their work lives now and you should use your recognition program to show them that their work is still fascinating and appreciated.