But wait... There something amiss...
Would your company's twenty-two year old hotshot salesman aim for the same things out of their career that your forty year old billing clerk wants? Is your technical staff looking for the same opportunities and reimbursement as your secretary?
Obviously, their wants are quite unique, but many business owners implement a one-size fits all method when commending their highly valued employees. When a big project is completed, all staff is awarded the same reward, whether it's breakfast or a gas card. Providing an identical reward to everyone is what's fair, right? But is it truly fair for your team's top staff?
Retain the Most Valuable Players
Surprisingly few entrepreneurs realize that the 80/20 rule applied to their people teaches that 20% of their people are producing 80% of your entire company's bottom-line. Further, almost every management book refers to studies which compare the productivity of the top staff to the not so competent (yet still useful) staff. The difference between the extremes have been found to be as much as 100 to 1. The closest these numbers ever seem to approach is at best 4:1. But how much more does this extreme sway in value wind up costing?
Assuming that your yearly cost for the company's least competent person is $30,000, how much does it cost for your top staff? Since a decent amount of the costs for staff stay the same, they don't go up in relation to base pay. For the purposes of this example, let's use some worst-case , $60k. Assuming that your $30k person delivers $30k of value (otherwise they'd be gone, right?). If your top employee is a measly four times more productive than the worst, they deliver far more value for how much more they cost.
If you pays for more training for the least valuable staff, costs immediately go up, but without any guarantee that productivity will likewise go up. Think about what part of your time is factored into the "cost" of this moderately competent employee? Probably none. Management costs are usually invisible, factored away as overhead. It certainly feels like you're being productive - trying your hardest to bring along the strugglers, hoping that they eventually rise above their shortcomings. Consider how much of your time is spent with either of these employees:
- The self-managing dynamo who, with speed of a bullet train, handles customer complaints, delivers defect-free results, and even cleans up after himself in the break room
- The newbie who has a few interpersonal issues, occasional quality issues, difficulty listening to reason, and shows up late on Mondays because of his occasional hangover
Obviously your top performers are worth the effort. As such, it's crucial for every small business owner to keep their top performers, as this group of your greatest makes up the bulk of your team's value. Their familiarity with your unique systems combined with their skills and ability to get the job done in a pinch makes them just about priceless.
But, what's the most effective way to reward your top people? How do you prove to those top performers that they're wanted, and increase the likelihood that they'll stick around?
What's the most effective method for motivating your superstars?
Pay them cold, hard cash. If your $30k staffer puts in 100-hour weeks during the final push of a key initiative, most pure monetary rewards would come in at a rate less than minimum wage. Just reconsider this alternative. This can be quite offensive, seen, instead, as a paltry offering to pay them off and ease a boss' guilty conscience. Regardless, after the IRS gets his piece of the action, the net value of this cash may be far less than it costs to give it out.
Send them to extra training. Some folks might be excited about an opportunity to take training in a new city on the company dime. They may even ask to spend the week before or after, out of their own pocket, just to take advantage of this chance to get away for a bit. Watch out though, this could seem to your top performer that you found their efforts lacking. They might believe that they have to have additional training to be worthy of the ultimate reward that they'll eventually get. If your worker is thin-skinned, they might get upset that all of that extra work they exerted was a red flag to you that they were not so doing well at their job. Offering a training reward in this situation could be mistaken that their challenge was obvious to you, and you've decided to take remedial action.
Offer a promotion. Though the draw of a striking designation or material benefits associated with a promotion may encourage some, more and more workers have come to recognize the risks of the Peter Principle. They're concerned that their world will shift drastically when they are promoted to team lead. Your powerful personnel probably enjoy what they're doing right now. That's why they're so incredibly good at it. Before trying out a promotion as praise, be sure that the new responsibility actually takes advantage of the talents and skills exhibited by these talented folks, or you may end up losing them. If you think it's best to risk it, make sure your key staffer realizes that they can get their old job again if things don't work out in the new situation.
Give extra holiday time. Everybody wants time away from the office, right? However, if you offer this reward to a very dedicated worker who is so totally committed to their occupation that they have little social interaction outside of the workplace, they may not know what to do with themselves during this leisure time.
Do unto others as they would have done unto them.
As you can see, there are quite a few methods to reward your top. It's dangerously simplistic to offer all of your employees the same award. It's especially easy to offer them what you would want.
These examinations reinforce a very simple concept: communication. In a nutshell, ask your best what they really want. What reward will let them to actually feel appreciated? The life that leads someone to be an excellent account manager is quite distinct than the life of a great office manager. You may be shocked by the answers you are told. In reality, your employees may be surprised, as well, to learn that you are truly giving them a say to decide upon the award for their hard work.
- Do they want cash?
- Do they want more challenging work?
- Do they want a little time away from work to appreciate their children?
- Would they like more mentoring?
- Do they simply want to be recognized at a company function?
- What rewards have they received previously that really made them feel appreciated?
The results can vary significantly for each person, depending upon their long-term goals, how their needs at this time are being fulfilled within Maslow's">http://www.abraham-maslow.com/m_motivation/Hierarchy_of_Needs.asp'>Maslow's Needs Hierarchy, and the current difficulties in their life. Don't make the blunder of presupposing that the answer you receive today will remain the same throughout your high performer's career.
At the end of the day, instead of hoping to reward your people the way you would prefer to be rewarded, break The Golden Rule, and spend the time actually learning their needs and wants. By involving them in decisions that affect their lives so immediately, you might unintentionally cash in on the Hawthorne Effect, and encourage your staff by proving you care. You will likely learn that you've developed a work setting that makes your high achievers more contented than they've ever been. Consequently, they will uncover methods to push themselves to new levels of productivity, understanding that their efforts will result in rewards that are actually significant to them. You may even earn their respect and allegiance for a lifetime.
Daiv Russell is a small business management and marketing consultant with Envision">http://www.EnvisionSoftware.com'>Envision Engineering.