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Tech Talk Fundamentals of the Software Design

Employee RewardsEmployee Rewards

Create a Culture of Achievement, Not Entitlement

Steer and Accelerate Workforce Performance

For many people, except for a paycheck, their work is purposeless. Ask people what they would do if they suddenly won the lottery. The first thing many would say is “Quit my job.” Everyone has their own reasons for wanting to be away from work. In many organizations, change is thwarted and talent is wasted. People go to work and feel little satisfaction. They cannot wait for the weekend where they can avoid the tension and boredom at work. They want to enjoy their life.

Today’s workforce is more diverse than ever. Multinational ethnic groups, young and old all mingle together in a diverse work place, and their interests and needs are just as diverse. Some want more free time while others want more overtime or career advancement. The traditional Total Rewards program is falling short in fulfilling the needs of this diverse workforce.

Total Rewards refers to the monetary and non-monetary rewards provided to employees in exchange for their time, talents, efforts and results. It is intended to attract, motivate and retain employees. Unfortunately much of what is considered the bedrock of total rewards is now seen as entitlements.
Part of this is because many total reward programs are entitlements, not rewards. Competitive pay, vacation, 401K, flex time, training, tuition reimbursement, healthcare and the list goes on. In many organizations, rewards are dished out not for stellar performance, but just for showing up. Well-intentioned managers delay reducing pay for poor performers. Ultimately this rewards mediocrity and punishes top performers. This socialization of rewards has driven up costs, and lowered our competitiveness.

Getting a reward before achievement has occurred is a gift. A reward is something you receive for achievement. You can attract a lot of people by giving things away. However, those with top talent want to be rewarded for their top performance. If mediocrity is rewarded with entitlements, then why work? Workers can just show up and collect their paycheck. If performance is rewarded, people will perform. As Bruce Pfau and Ira Koy say in “The Human Capital Edge,” pay for performance works because it is based in human nature. People do things that are in their best interest. They do not do things that are not in their best interest. As a result some companies have outsourced work to countries where labor costs are lower and the work ethic is higher. But it doesn’t have to be that way.

Performance with Fulfillment

Work becomes fulfilling when people receive personalized rewards and benefits for their achievements. I remember a colleague coming to my office one day, fuming mad about the reward she was given for suggesting a way to save the company thousands of dollars each month. Her boss, gleeful with the suggestion, rewarded her with a “Perk.” A Perk was a certificate given for above and beyond job performance. You could trade the Perk for luxury items such as a beach towel, an umbrella, or $10.00 in cash. My friend threw the perk card on my desk, and snapped, “Look what they gave me. They will never get any more ideas out of me.”

Had management understood my friend’s motivational “Hot Buttons” like I did, they could have sparked her interest in innovation and reinforced many others at the same time. All her manager had to do was call a reporter for the internal newspaper, The Communicator, who would have taken her picture and described her success in the next edition. People would have smiled as she walked down the halls, high fiving and congratulating her. She would have been walking on air for weeks. For this lady, recognition was her second most preferred reward.

Another Powerful Non-financial Reward

What really motivates workers? Researchers Teresa Amabile and Steven Kramer published the answer to this question In the January-February 2010 issue of Harvard Business. Based on a multiyear study involving hundreds of knowledge workers, the researchers found the highest levels of motivation and drive occurred when participants made “progress” or when they received support in removing a work barrier. Rewards that satisfy individual interests and needs are powerful motivators.
Performance with fulfillment is generated when personalized rewards are received for progress and goal achievement. Mastering the use of financial and non-financial rewards enables managers to direct and drive mission strategy and goals with employee passion. Performance Path’s® Incentive Profiler offers organizations a way to return rewards and benefits to their natural and intended function. That is, people receiving personal rewards according to their measure of contribution. This is the only sustainable way organizations can attract, motivate and retain the top performers. Sure, new technology may provide a momentary bump up in productivity, and just as quickly, competitors will copy the technology even before you have received a return on your investment. However, a high performance workforce cannot be copied. Cost of benefits can be greatly reduced by pinpointing the most desirable financial and non-financial rewards valued most, by each employee. Total Rewards are unable to provide the cost savings or boost the productivity necessary to remain competitive in an international marketplace.

In summary:

  • Recognizing patterns in human performance and reward effectiveness are lead indicators of future financial performance.
  • Managers must have the metrics and training to measure, analyze and motivate their workforce.
  • Analyzing these patterns allows management to recognize the tell-tale sign of trouble before there is a tangible impact on the organization.
  • Performance Path® provides all managers with the tools and metrics needed to direct human behavior and steer their organization as a captain steers a ship.
     

Article © Copyright 2011 Performance Path ® LLC. All Rights Reserved.
 

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