Generosity in Employee Incentives and Rewards
Your employees work for money but their compensation is not a key factor in their happiness. Financial remuneration is an element of job attractiveness and is great for recruitment purposes. Role retention, how long employees stay in their position, is far less related to how much employees get paid.
According to research published in the European Journal of Business and Management, the factors that most impact employee retention are organizational culture, communication, strategy, pay and benefits, flexible work schedule and a career development system. Successful organizations at employee retention will be those which adapt their organizational culture to the ever changing work environment and success will depend upon innovation, creativity and flexibility.
Let’s think about organizational culture. I’ve always said that your company has an organizational culture whether you like it or not. Whether the senior leaders of your organization work at it or not, a culture exists. The key question is: are you consciously establishing and nurturing a corporate culture that hits all of the elements on the employee retention list?
We know that happy employees are more devoted and contribute more selflessly to organizations. We know they do better work and that retention of employees is far less costly than hiring and training new employees. So why don’t entrepreneurs dwell upon their organizational culture? Good question.
The first and foremost element of building a strong corporate culture of employee retention is communication, especially in the context of developing relationships amongst the employee base. Communication has to be grounded in listening – listening the Stephen Covey way: seeking to understand then to be understood. Most people listen to respond rather than listening to understand. This is a rampant fault in most corporate cultures. Listening builds understanding which builds relationships. Solid relationships are the basis of all corporate results.
The next element of corporate culture to consider is core values alignment. Building a strong culture requires organizations to understand their value system and establish behaviours related to these core values. If an organization is a stand for customer service, as an example, then all employees must understand the specific ways they must behave to act consistently with these values. Focusing on values allows the employee base to come together in a meaningful way. Those who do not relate will weed themselves out which will keep the core members of the company on a stronger footing.
The last element of culture in this context of retention is employee development, rewards and benefits. Meaningful rewards are those that touch, move and inspire employees. Meaningful development plans and benefits must be personalized. The more personal and customized the benefit, development plan and reward, the more meaningful it is. The more your culture is based in solid relationships, the easier it is to understand what elements are meaningful. And lastly, the more you entrench this into your corporate culture, the higher will be your employee retention.
Written by: Darrell Kopke