Undoubtedly, the recession of 2008 and 2009 has proven to be a wake-up call for business globally. Relatively few enterprises have been left untouched, and those who have survived may have experienced layoffs, furloughs, wage freezes and other drastic cost-cutting measures merely to weather the storm and come out on the other side somewhat intact. For no one has it been business as usual.
This has been a time of introspection, recalibration and elimination of fat and fluff. For some, it has been a realization that the core of their business model has been forever altered. The inability to monetarily reward our employees has forced many of us who have responsibility for our organization’s total reward programs to revisit our compensation and benefits and make some significant changes. In the shadow of no raises or, even more significant, no wage reductions, as well as passing on more benefit cost sharing, compensation and benefits pros have been placed on the horns of a dilemma. Is it enough to ask our employees to ride out the storm with us with the hope that the economy will turn around “someday” and allow us to resume our normal operations? Instead, do we look at the long-range impact of decisions we are making now and research, design and implement programs that will mitigate the sting of cost-cutting, keep our workforce engaged and productive, and head off an exodus of high performers once the veil of recession begins to lift?
This begs the questions: What do our employees really want? What would be a meaningful way to continue to reward our employees, even in times of economic strain? Is it possible to deflect some of the impact of tough economic times, both for our organizations and for our employees? Granted there are those of us who have had to make the painful decision to reduce the workforce — but the good news is that many organizations plan to hire back a significant number of those laid off. What about RIF survivors? And what about those who have managed to stay afloat without losing staff, but only by taking significant cost-cutting measures? How do we keep our employees engaged when there is so much insecurity? Are psychic rewards enough?
These questions sent me on a journey to determine what my organization could do to soften the blow of two years without raises. Although not faced with a layoff, our employees have been asked to do more with less, cut out unnecessary travel and scrutinize spending. Contingent staff, enjoyed over the years to shoulder the excess workload, has been reduced to a trickle. Staff has been reallocated, projects and positions put on hold and unnecessary positions eliminated. What I found in my research led me on a journey not just of best practices in compensation and benefits, but more so of human behavior and motivation.
Most of us in HR understand that money is not the primary motivator for most employees. To be honest, I’ve heard that pay only motivates for about 20 minutes, then it’s back to business as usual. In fact, pay is what’s called a hygiene factor. It doesn’t motivate. It only serves to demotivate when it’s not considered fair or adequate. Granted, we need money to live and to meet the needs that we as individuals have identified as necessary and important to maintaining our standard of living. But what are the components of our employment relationship that truly motivate me? Motivate you? We need to ask our employees to identify what keeps them coming to work for us. We may be surprised by their answers, but it is important that we ask. Some might not be able to articulate their answers, but we can elicit some powerful information if we spend some time asking the right questions. Armed with that information, can we somehow rebuild or revamp our current reward system around those intrinsic and extrinsic rewards that will continue to meet our employee’s needs and also serve as promoters of engagement and productivity? Not surprisingly, the answer is yes. Even more importantly, these can be implemented at little to no cost.
First, let’s look at what truly motivates employees. The most recent polls reveal the following in order of importance (as of 2009):
Job security (freedom from the “shoe falling”). A powerful stress reliever, and a contributor to greater productivity. Caveat: Although no one’s job is truly secure, we can communicate a commitment to be transparent, honest and forthcoming about the company’s future. Knowing beats not knowing. Transparency and honesty will go a long way to promoting commitment to your organization.
Recognition, praise and the opportunity to learn. Leaders, this is one for you. It costs nothing to recognize an employee for a job well done. Be specific. Don’t just say you did a good job — tell the employee specifically what they accomplished and why this was important.
Recognizing and rewarding top performers. Give them stretch assignments, give them opportunities to own the successes of their assignments, ask their opinions, allow them opportunities to learn and grow. Realize that your top talent will bail once the recession lifts if you don’t treat them right. Top talent always has a place to go. How you treat your employees in the down times will be reflected once the recession lifts. See a lot of turnover coming? Time to do your homework. The latest polls show that a majority of employees will be looking for new opportunities once the recession fog clears. How you treat your employees now may have a significant impact on your turnover once the job market softens.
The ability to have fun in the workplace. How often do we have fun at work? What do you do for fun in your office? Do you have a culture that promotes humor and camaraderie? If we spend most of our waking hours with our co-workers, shouldn’t that be enjoyable? Nose to the grindstone, micromanaging, drudgery and boredom all contribute to the idea of work as an endurance race, not as an enriching experience. What small elements could you add to your office to make it more enjoyable? Our office has a door decorating contest at the holidays with prizes for the best door. We also have monthly celebrations of birthdays and milestones. Sometimes someone brings in a homemade goodie and sends a message to the staff that brownies and ice cream are available in the administrative area. Small things? Yes. But, when work is fun, it motivates. It can break down those professional barriers that prevent us from collaborating and contributing to our fullest. A short break re-energizes our creative and productive juices. “You will break the bow if you keep it always bent.”
Benefits. Review the benefits you’re offering, and see if there are some tweaks that you can make. One of the most significant changes made in my office is to officially endorse flexible work arrangements. These types of arrangements are currently the most sought after work/life perks. If you think it will destroy productivity, monitor work produced. If the work gets done, and your workforce is happier, then it is a win-win for you and for your workforce. Sometimes we are the biggest impediment to making changes because change is hard. But change is inevitable and necessary. Another small change we have made has been to allow 24 hours of vacation to be cashed in at holiday time. No, we’re not giving raises, but we are paying out vacation at today’s dollars, and at a time that may be the difference between an employee having a happy holiday, or going without. This is also a win-win. The holiday time is off the books, and the employee has the equivalent of three days’ pay that otherwise may have been lost.
There are many low- to no-cost ways that we can beef up our benefits package. The key is offering those changes that will be meaningful to your workforce. It also involves allowing the employees to have choices. When an employee feels more in control of one aspect of his or her life, the fact that he or she can’t change the economy will be lessened somewhat. Tuning in to our employees’ wants and needs is vital to enhancing their work experience. We know that we won’t be able to please everyone, but who knows? We may find out that this Great Disruption turned out to be the catalyst for some fairly significant and beneficial changes to the way we do business.
Pamela Baldwin, SPHR, CEBS, is a human resources professional with a masters in human resources and second in instructional design. Certified as an SPHR by the Human Resource Certification Institute and a certified employee benefit specialist by the International Foundation of Employee Benefit Plans and the Wharton School of the University of Pennsylvania, she has over 15 years experience in human resources and administration. Along with her full-time job in a public sector agency, she also has a consulting business in which she assists small to mid-size businesses with their human resource function. She serves or has served on various boards, including the Nature Coast Human Resources Society, the Rasmussen College Business Advisory Board and the Business Assistance Committee of the Greater Hernando County Chamber of Commerce, and currently serves as the 2010 secretary of the HR Florida State Council. Pam, a 13-year resident of Florida, has 3 grown children, 2 grandchildren, and 4 ¾ cats.