columbus compensation association february 5, 2009 stan striker
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Columbus Compensation Association
February 5, 2009
Stan Striker
Things you will take away…• Motivation beyond basic benefits• Employee engagement and the
connection to customer satisfaction
• Research tied to recognition and it’s impact on employee satisfaction
• The role of the front-line manager• Best principles of recognition
Current State
• Drivers creating change in the workplace:– Mergers & acquisitions– Down-sizing– Budget cuts– Role consolidation– Changing workforce profile– Benefits, compensation adjustments– Cultural alignment– Customer satisfaction focus
Total Rewards Model
Performance ImprovementPerformance ImprovementEngage, Motivate, Recognize, RewardEngage, Motivate, Recognize, Reward
Basic CompensationBasic CompensationAttract, Retain, DevelopAttract, Retain, Develop
Base PayBase PayMerit IncreasesMerit Increases
Skill-based Skill-based CompetencyCompetency
Base PayBase PayMerit IncreasesMerit Increases
Skill-based Skill-based CompetencyCompetency
BenefitsBenefitsBenefitsBenefits IndividualIndividualIndividualIndividual GroupGroupGroupGroup ProjectProjectTeamTeam
ProjectProjectTeamTeam
Total Performance Management StrategyTotal Performance Management StrategyTotal Performance Management StrategyTotal Performance Management Strategy
Business Objectives and Desired CultureBusiness Objectives and Desired CultureBusiness Objectives and Desired CultureBusiness Objectives and Desired Culture
• The total rewards model illustrates the total investment organizations make in their human capital.• Basic compensation makes up the entitlements as conditions of employment.• Performance Improvement opportunities engage, motivate, and focus actions.
WorldatWork
Recognition or Incentive?Definitions
Incentives
Incentives
• “Do this, get that”• Formula based• Pre-announced• Focus: Tangible value• Self-funded
Organizational improvement primary objective
RecognitionRecognition
• “Great Job”• Discretionary or
competitive• Generally “after the fact”• Focus: Psychic value• Budgeted
Reinforcement of corporate values primary objective
How Not to Deliver Recognition
“I can live for two months on one
good compliment.” Mark Twain
Dr. Bob Nelson
“You’ll never get the best from employees by trying to build a fire under them – you’ve got to build a fire within them”
What is the Impact of Recognition?
The Issue The Impact
RetentionEmployees satisfied with recognition 20x more likely to spend career with company1
Engagement Employees satisfied with recognition 70x more likely to be completely satisfied with their job1
Alignment Recognition Training empowers managers to reinforce the behaviors that drive organizational strategy
Individual Performance
Recognition= engagement factor with strongest correlation to improved individual performance2
Organizational Performance
“Recognizing excellence” correlates with 6 times greater operating margin3
Customer Satisfaction
Work locations with top R&R scores have top Customer Sat scores4
Consolidation Up to 35% reduction in administration costs4
1 2006 Maritz Research Poll2 2006 Linkage Analysis Study – Maritz Research 3 Incentive magazine, August 2005, pg. 10 Question wording: “My company recognizes excellence?”4 Customer Satisfaction and Recognition analysis performed for financial services clients
* Forum for People Performance Management and Measurement Research at MeDill School at Northwestern University
In other words!
“There is a direct link between…”
So, where is the disconnect?“Perception is not always reality!”
Factors Employees ManagersFull appreciation for work done 1 8Feeling “in” on things 2 10Sympathetic, help on personal problems 3 9Job security 4 2Good wages 5 1Interesting work 6 5Promotion/growth opportunities 7 3Personal loyalty to workers 8 6Good working conditions 9 4Tactful disciplining 10 7
Sources: Sheryl & Don Grimme, GHR Training Solutions Bob Nelson, Blanchard Training & Development Ken Kovach; Valerie Wilson, Achievers International
Manager Skills and Knowledge“People don’t leave jobs, they leave managers.”
Do managers and supervisors have the knowledge, skills and abilities to deliver effective recognition?
– Train managers on:
• The business imperative for recognition
• Key recognition and reward principles
• How to give effective recognition
• Their responsibilities with the new program
What’s Going On?• Satisfaction with recognition is always among the lowest rated
items on employee engagement surveys.– Even among companies that otherwise fare well
• Problem: Recognition that is not ‘meaningful’ is at best ineffective…and at worst de-motivating.
• Design is then a very important factor to delivering effective recognition
Best Principles (Not Practices)World-Class employee recognition plans reflect consistent principles, i.e., plans that are…
• Imbedded in philosophy and core values
• Championed by senior management
• Owned and sponsored by unit & line management
• Viewed as investment, not expense
• Used consistently and equitably
• Decentralized and tailored to meet business
unit objectives
• Tailored to respect that different people
are motivated by different forms of recognition
• Continuously evaluated and renewed
Understanding Motivation: Our Whole-brained Philosophy
Focus Shapes PerspectiveThe act of paying attention creates chemical and physical changes in the brain
Repeated, Purposeful Attention Focusing on specific ideas, closely enough, often enough and for a long enough time changes behavior
Source: “The Neuroscience of Leadership” by David Rock and Dr. Jeffrey Schwartz
You must rewire the brain to create new habits and get past the discomfort of change
Positive Reinforcement
Encouragement and reinforcement of new behaviors helps brain build
new pathways
Human Truths Require a Whole-brained Approach
Even when people want to change, it’s hard to learn new behaviors and habits
People alwayshave the power to
choose
People base actions on emotions as well as rational thought
Use positive and meaningfulconsequences for changing behavior and achieving results
People’s behavior is shaped by consequences
Focus, repetition and feedback are necessary to “rewire” the brain
Include communications, education and leadership to help people understand the goals and strategies and make their own connections about the importance of achieving common goals
Make sure program design is both fair and fun to engage both the left and right brain.
1. What do you want me to do?Role Clarity: easy to understand direction
2. Why is it important?Strategy & Vision: embedded philosophy, values, management and leadership
3. How do I do it?Competence & Capability: integrated program, continuous communication
4. What’s in it for me?Rewards & Recognition: meaningful and motivating rewards
5. How am I doing?Measurement & Feedback: monitor results, provide feedback and communication
Reinforce a whole-brained approach by
answering 5 key questions.
Educate and Communicate
Engaging Events
Cascading Meetings
On-Going Communications
Everyone
Managers
Champions
Measure and Feedback
• Four Levels:– Program Usage:
Given and Received– Behavior Tracking:
Recognition Criteria– Integration:
Engagement Scores
– Linkage to business results and ROI
What rewards best drive behaviors?
“…psychological processes can increase the perceived value of tangible non-monetary incentive awards over and above cash-based awards…”
The SITE Foundation, Prof. Scott Jeffrey, University of Chicago
21
Baby BoomersBaby Boomers Generation XGeneration X Generation YGeneration Y
What does our workforce look like?
TraditionalistsTraditionalists
Born:1946 to 1964
75.5 million
Born :1965 to 1980
44 million
Born: After 1981 (to 1994)
76 million
Born:Prior to 1946
45.4 million
(Source: U.S. Bureau of the Census)
The Act vs. The Rewards
Personal Private
Written Verbal
The “How” The “What”
Experiential
Merchandise
Hot, Brand Named Merchandise
Purposeful Choice is Key• A wide assortment
of rewards A points based approach.
• Plus featured rewards that emphasize the message and the program
Gift Cards
Individual Gift Cards
Unique Multi -Merchant Shopping Cards
World Class Online Travel Featuring
Travel
Unique Entertainment & Experiential Options
High End Events
Experiential
Program Management: Centralized Program, Local Flexibility
Formal Annual & Quarterly Recognition
Informal Recognition Weekly/Monthly
Day to Day Thank You
Peer-to- Peer
Managers
Top Performers
Bronze: Manager to associate recognition.
Gold: Annual recognition and reward ceremonySilver: Nomination-based, formal quarterly recognition & celebration
All-associate, low-cost or no-cost recognition.
Important Take Aways
Communicate business decisions and direction; ensure programs are tied to this direction
Grow supervisory skills in developing relationships with employees
Tap into employees concerns; reinforceprogram criteria
Provide growth opportunities and new skills opportunities related to criteria
Reward key behaviors that drive business goals
Appendix
• Stan Striker: V.P. Client Services, Maritz Motivation, St. Louis, Missouri [email protected]
• Book: Dr. Bob Nelson “1001 Ways to Reward Employees”
• White paper: The Benefits of Tangible Non-Monetary Incentives, SITE Foundation
• Website: www.buyrewardsdirect.com