Retaining top employees is always a challenge. But as the country sinks deeper into recession and corporate finances tighten, it’s imperative to find ways to hang on to key people without taxing the bottom line.
“Incentive programs increase employee retention and help to improve work-place morale,” says Rob Wilson, president of Employco Group. “In this economic climate, it’s very important for businesses to develop creative cost-effective programs that make key employees want to stay.”
Smart Business asked Wilson how CEOs can structure plans that keep employees engaged and still maximize the bottom line.
Why is it critical to develop cost-efficient incentive programs?
They help your company stand out against the competition when employees are talking about their workplace in a positive tone. It makes employees feel good about walking into the office each day. Let’s face it, work can be mundane, and anything you can do to change things up and get people excited is a good thing. For example, you can let employees wear Cubs or Sox gear on the first day of the season. Or allow them to wear jeans on some days. You might get about 90 percent of the staff to participate. By doing so, you motivate employees without spending a lot of money or giving anyone a raise.
What types of individual incentives can be developed?
There are many things you can do. We had an NCAA tournament pool here, and our company not only paid out the top three winners, but also the person who came in last. We probably spent about $300, but it produced a lot of excitement, and people were talking about it throughout the tournament.
CEOs can implement creative ideas like dressing up for St. Patrick’s Day or Halloween. They can name an employee of the week and month and put up their picture and give them a special parking spot. It costs the company nothing, but, at the same time, it recognizes the employees that do a great job.
You can do the same thing with gift cards. These don’t cost a lot of money, but the recognition that comes with receiving one is priceless.
And there are incentives that do things to help further employees’ careers, as well. You can send them to outside seminars that aren’t very expensive but provide the tools needed to move up the corporate ladder. You can let them take college classes and pay for them as long as they maintain a certain GPA. This is a great incentive because, statistically speaking, if you offer it company-wide, not all employees will take advantage of it. You might end up paying for a handful of people to take classes, and the company benefits from the employees’ gained knowledge.
Another idea is to send people to Chamber of Commerce lunches to represent the company in an official capacity. It’s work-related, but the employee receives lunch and a day out of the office networking. In some industries, you can also give commissioned employees trips or vacations on top of their commission. If it’s a group trip, you can get a good rate.
When a smaller company offers a nonfinancial incentive, is it geared more toward the individual or the company?
It can be geared toward both. With a small company, you’re more likely to treat incentive programs as a group. Everyone is working together toward the same goal, and everyone knows what’s going on. However, as a small company you also have the opportunity to offer an incentive based on an individual performance.
In most cases, we recommend a company-wide policy even though people end up being singled out. Overall, however, it should still be a company-wide policy. You need to be careful on the individual side so that you don’t run into discriminatory issues or appear to play favorites. For example, if you offer flex-time to a single parent, you need to make it available to everyone.
Do these types of programs contain enough meat to keep employees from thinking the grass is greener elsewhere?
They do. You’d be surprised, but with many employees, it’s not just about salaries. For most people, it’s the environment. They want to be part of a company that’s considered a great place to work. And a good incentive plan can be a very important part of that.
ROB WILSON is president of Employco Group (www.employco.com), a division of The Wilson Companies. Employco handles human resources outsourcing for 400 small and medium-sized Midwest companies. Reach him at (630) 286-7345 or email@example.com.