To get and keep good people, many employers are finding that incentives are the key
Everyone still wants to get paid, but more and more, they see the things that money can’t buy as the best incentives to stay with or take a job.
Recruiting and retaining the best workers traditionally has been considered a matter of offering competitive wages, bonuses or perks such as travel, profit sharing or use of company vehicles. But at a time when industries from accounting to nuclear energy face a tight squeeze for talent, the right enticements can be incredibly important.
One reason is that companies are aggressively poaching their competitors’ best employees, according to the Incentives Research Foundation’s 2014 trends report. A combination of skills gaps and aging workforce across the economy means the talent pool is set to shrink by some 40 percent, making it harder for companies to fill vacancies or position themselves for growth. The report argues that this reality should encourage companies to invest in their incentive programs.
Traditional incentives such as financial compensation don’t tend to work for long, nor is training a very attractive enticement, said Jane Allen, founder and CEO of Smart Work Network in Greenville. More appealing are opportunities to try out different job functions, or to experience the challenges of working in a foreign country.
“We think that’s one of the main issues. If they can be in a job where they really get to max out who they are, they will stay even if they’re offered another job with more money,” Allen said.
Flexibility is also becoming a key issue in recruitment and retention, experts say. In practice, flexibility means giving employees more control over when, where or how they work. Many of today’s workers consider periods of intense work punctuated by long breaks of a few weeks or even months to be more attractive than a more forgiving daily schedule with just a few weeks of vacation each year. Especially for younger workers, the notion of flexibility might mean being able to access social media sites while at work.
A Matter of Time
The ability to set a schedule that fit her personal goals was a major factor that brought certified financial advisor Laura Copsey to Nachman Norwood & Parrot. Before joining the Greenville wealth management firm, she and Managing Director Bob Nachman discussed eventually reducing her hours so that she could pick up her two children – 3 years old and 6 months old at the time – from school.
“The commitment was huge on the front end because I [would be] leaving before the markets would close, so there would still be active business happening,” she said.
The firm agreed to the plan, so she took the job. When the time came to reduce hours, Copsey said her salary was reduced accordingly, “but that didn’t bother me because I was doing the things in the afternoon with my children that were so important to me.”
In the 14 years since the arrangement was made, several other employees have worked out flexible schedules at the firm. That is rare for their field, Nachman said.
“It’s an intangible that is provided to the office by all of us who do it,” Copsey said. The years of being able to live the life she dreamed, unlike many of her peers, have cemented her commitment to her employer. “I can speak for myself; I’m very loyal to the office. Headhunters might call and inquiries might happen, but the answer is no.”
Know Thy Staff
People who stay are people who are in the right job and the right organization, Allen said.
“Many people think you have to motivate people, and you really can’t. All you can do is build a culture where people want to be there. And the way you engage them is you find out who they are.”
So even though financial incentives are generally sliding down the scale of importance, some employees are most driven by them. For instance, Allen said a surprising number of companies limit how much their sales teams can earn in commissions, despite the fact that the thrill of seeing bigger and bigger numbers might be exactly what motivates them.
On the other hand, more money is only a short-term fix for somebody who sees more variety or a more flexible work schedule as the more valuable reward. Soon, no amount of money will be enough.
Allen said employers who take the time to discover what motivates the employees they already have might find themselves surprised. Her company provides career counseling and talent searches, and she said companies perform better when they understand their internal cultures and how well different people fit into them. Even startups should spend time understanding who they are.
“It’s even more applicable in a small company,” she said, “because you can get it wrong and lose your shirt.” Allen said she personally learned that lesson the hard way with poor hiring in the past.
Nachman said the firm’s philosophy of being open to what employees say they want and need has paid off in very low turnover, with most employees having been with the firm 10 to 15 years. Most often they’ll try a proposal to see if it works before rejecting the idea.
“I think we have taken the approach from the beginning that we wanted to have a good place to work and be competitive with things like pay and flexibility,” Nachman said. “It is very hard to expect people to be happy and serving our clients well if our employees aren’t happy. Figuring that out was a big plus.”
“The War for Talent,” by Ed Michaels
“Generations at Work,” by Ron Zemke, Claire Raines and Bob Filipczak (Second Edition)