It seems incredibly simple, eh? "Do unto others as you would have them do unto you." The Golden Rule feels so universal that it might be a remedy for all human relations. Simply act toward everyone the way you would prefer to be taken care of and everything will flow wonderfully, right? Just a second. Something is amiss. Does your twenty-five year old big shot salesman want the exact same things out of their job that your forty year old accounting clerk does? Is your technical staff hoping for the same opportunities and rewards as your secretary? Obviously, their needs are quite distinct, however quite a few bosses use a one-size fits all approach when rewarding their most important staff. When a big project is done, everyone is awarded an identical thing, whether you give them dinner or a gas card.
Providing the same thing to everyone is what's fair, right? But is it actually fair to the top employees? Retain the Most Valuable Performers Too few business owners know that the 80/20 rule applied to their staff indicates that only 20% of their staff are delivering most of your entire business' success. Further, nearly every management book recounts studies comparing the productivity of the top team members to the least competent (yet still useful) team members. The distinction between the top and bottom have been reported as broad as one hundred to 1.
The nearest these statistics ever seem to get to one another is about 4:1. But how much more does this extraordinary variance in value wind up costing? Assuming that your yearly salary for the company's least competent employee is $30,000, how much does it cost for your top staff? Since a lot of the costs for staff are fixed, they don't go up in relation to base salary. For the intent of this examination, let's use some worst-case numbers, $60k. Assuming that your $30k employee generates $30k of value (otherwise they'd be gone, right?). If your top employee is a measly four times as productive as the worst, they deliver far more value for how much more they cost. If your business invests in more classes for the bottom-rung staff, costs immediately go up, but without any assurance that productivity will similarly go up.
Consider, also, how much of your salary 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:
Indeed your top performers are worth their salt.
- 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 new guy who has a few interpersonal issues, occasional product defects, problems following instructions, and shows up late on Mondays because of his occasional hangover
As such, it's crucial for every small business owner to retain their top performers, as this group of your greatest makes up the bulk of your team's value. Their familiarity with your unique processes together with their talents and ability to get the job done in a pinch makes them nigh unto priceless. So, what's the most effective way to reward your top people? What should you do to indicate to those high performers that they're appreciated, and boost the likelihood that they'll be there for you when you need them again? What's the most effective way to reward your best people? Pay them cold, hard cash. If your $30k staffer cranks out 70-hour weeks during the final push of a key effort, most pure cash rewards would come in at a rate less than minimum wage. Simply rethink this alternative.
This can be extremely insulting, seen, instead, as an insignificant effort to buy them off and ease a boss' guilty conscience. Regardless, once the taxman gets his piece of the action, the ultimate value of this cash can be a lot less than it costs to give it out. Pay for a training trip.
Some people might be excited about a chance to attend a course in a new city with the company picking up the check. They may even like to spend the weekend before or after, on their own, just to take advantage of this chance to stretch their legs. Be careful though, this could seem to your high achiever that you found their efforts less than desirable. They might wrongly assume that they have to have further classes to be worthy of the real reward that they'll eventually get. If your achiever is thin-skinned, they could get concerned that their effort they exerted was a warning sign to you that they were not so doing well at their job. Proposing a training reward in this situation could be mistaken that their struggle was apparent, and now you are taking corrective action.
Promote them. Though the attraction of a striking title or material gains accompanying a promotion may encourage some, more and more workers have come to understand the dangers of the Peter Principle. They fear that their world will shift a great deal when they become manager. Your turbocharged talent probably delight in what they're doing right now. That's why they're so incredibly capable at it. Before considering a promotional reward, make sure that the new responsibility truly takes advantage of the skills and capabilities present in these high achievers, or you may end up losing them.
If you think it's best to take this chance, ensure your rewardee understands that it's alright to get their old job again if things don't work out with the newly promoted role. Offer more time off. Everybody needs to get away, right? However, if you offer this bonus to a very committed worker who is so completely committed to their occupation that they don't have many friends of the workplace, they may not know how to conduct themselves during this spare time. Do unto others as they would have done unto them. As you can see, there are quite a few mechanisms to reward your best.
It's dangerously simplistic to offer each of your employees the same reward. It's especially easy to offer them something you'd like yourself. All of this leads to a very simple concept: communication.
In a nutshell, ask your best what they really would like. What is it that will allow them to truly understand that they are loved? The path that leads a person to be an excellent account rep is quite distinct than the life of a great administrative assistant. You may be surprised by the replies you hear. Actually, your staff may be amazed, as well, to discover that you are truly giving them a voice to decide upon the award for their efforts.
The answers can differ notably for each person, depending upon their long-term ambitions, how their desires are currently being fulfilled within Maslow's Hierarchy of Needs, and the current challenges in their life.
- Do they want cash?
- Do they want more demanding responsibilities?
- Do they want some time off to appreciate their children?
- Would they rather have more mentoring?
- Do they simply want to be praised at a company get-together?
- What rewards have they received previously that really made them feel appreciated?
Don't make the blunder of believing that the answer you hear today will remain the same throughout your top performer's career. At the end of the day, rather than attempting to reward your staff the way you would like to be rewarded, break The Golden Rule, and invest the time actually understanding their needs and wants. By involving them in decisions that affect their lives so directly, you might inadvertently cash in on the Hawthorn Effect, and encourage your people by demonstrating you care. You will probably notice that you've produced a work setting that makes your high achievers happier than they've ever been. Consequently, they will discover ways to push themselves to new levels of efficiency, understanding that their efforts will result in rewards that are truly meaningful to them. You may even earn their respect and loyalty for a lifetime.
Daiv Russell is a small business management consultant with Envision Engineering.