I had a conversation with a client this week about the struggles they are having to improve performance. They are a recruitment agency, so like other recruitment agencies and estate agents who we look after, the staff are set targets and are paid on their performance. However, from our conversation, it appears that the incentive of pay is not enough!
During our discussion, I referred to another client who we support and an exercise I did with them about 4 years ago. In this instance, the business owner really wanted to provide a great environment for his staff and as such arranged for twice weekly deliveries from the local supermarket. This kept the team topped up with fresh fruit, bread, cereal and freshly squeezed orange juice from their juice machine. But this was not enough, and staff turnover levels were causing significant issues for the business. Not only were staff disgruntled before they left, and therefore not performing at an optimal level, but once they had left, the business had to deal with a vacancy, recruit a replacement and get them trained up. It’s time consuming, stressful and expensive!
During our focus group sessions, it emerged that the staff resented being pulled in multiple directions. They were given performance targets for their ‘day job’ but then told to get involved in other projects related to sister companies. As a result, they were not able to deliver to the standards required in their key job, leading them to be demotivated, resentful and feeling that they had been taken advantage of. No one felt they could say “no” to the boss, so the resentment grew.
Just by enabling the discussion to take place and really understand the real root of the problem, the business was able to make a number of changes. Some of these were just about managing expectations from the start of the recruitment process, so that candidates had a choice about whether to work in this environment. Some of the changes were to the way in which performance was measured and this was much more collaborative but based on well communicated business targets.
From the conversation this week, we still have a lot of unpicking to do. I thought back to my days as a psychology student and the study of Maslow’s Hierarchy of Needs. If people have their basic needs taken care of, then they are more likely to perform. However, if things are too comfortable for them and there is no incentive to perform and no penalty for not performing, then staff can outstay their welcome.
Today’s employers are trying to balance the needs of at least 3 generations in their workplace and whereas 20 years ago, the needs of the workforce were fairly uniform, today we are seeing huge diversity. For some, the need for job security is very high on the agenda, but the younger generation do not expect to have a job or even a career for life.
For some employees, the total reward package may be of greater interest and this includes pension, health care, career opportunities, the working environment and the culture. However, for others the need for a high income to enable them to get on the housing ladder is crucial.
Increasingly, we are seeing the younger generation more interested in the gym membership and company perks, but small employers are often unable to offer this. For the older generation, the opportunity to take more holidays or to work flexibly as they head towards retirement is very appealing.
At the end of the day, your staff are all individuals and it is really important to tailor their rewards as much as possible. The more choice you are able to give employees, the more incentivised they are.
One employer I know asks his employees what their reward should be if they hit certain targets. The responses have included holidays, theatre trips, designer handbags and even a car. However, he also asks the team what the consequences should be if they don’t hit their agreed targets. In many cases, the response has been “You need to fire me”, but he has also had responses such as “that won’t be a problem as I will do whatever is needed to hit my targets” and “you can fine me”.
Your employees need to be fully engaged. They need to be rowing your boat in the same direction as you. They need to be operating at 100% on your behalf. If they are not, you need to find out why. QUICKLY! Are they a ‘can’t do’ or a ‘won’t do’? A can’t do needs training and support. A won’t do needs to be shown the door.
Making sure you have a clear vision for your business which is documented and communicated in terms of goals and objectives is the first step to a successful business. The second step is making sure you have a team who are going to get you there. If you don’t….. change the team!!!
