When it comes to employee fringe benefits, small- and medium-sized businesses are in a tough position. Fortune 500 companies often offer unbeatable benefit packages, profit sharing and 401(k) matching with which their smaller counterparts simply cannot compete. This begs the question: How can businesses with less to spend secure and retain top talent? It took me 10 years as a business leader to answer this question and the conclusion was surprising.
Employee morale was not necessarily tied to the cost I spent on benefits and perks. Of course, paying employees fairly is important. But what I learned over the years is that small things do matter. As simple as it sounds, I truly believe that small personal touches are responsible for my company’s, Akraya Inc.’s, No. 1 position on the San Francisco Business Times’ 2011 Best Place to Work in the Bay Area list.
Growing businesses often make the mistake of concentrating all their efforts outside of the company to bring in investors and clients. My experience is that it is never too early to start building a strong company culture. Instead of letting the company culture take a back seat, shaping company traditions and customs with the same vision and precision used to shape your products and services is important. This can be as simple as choosing a company mascot or an artifact of significance that symbolizes the company’s values.
At Akraya, celebrating success has always been a cornerstone of the culture. Thus, we installed an old-fashioned dinner bell in a central area of the office that we named the Akraya Bell of Success. Every time an employee completes a project or comes up with a solution to a problem, his or her supervisor rings the bell and the whole team gathers for a round of applause.
While Fortune 500 giants have the budget to wow employees, small- and medium-sized businesses possess the power of flexibility. They simply aren’t constrained by a 500-page policy manual. And flexibility is something employees really appreciate. One way of exercising this is to simply grant time to employees to attend to family obligations or take time off when going through a rough patch. Sometimes, even a small favor like letting them arrive to work half an hour late to avoid traffic can improve their lives.
Another important lesson learned is that when it comes to investing in perks, you should spend on things that really hold value to the employees. Company picnics are great, but they can feel like a burden, especially if the employee already has little time left after work hours. But a couple years ago, I observed that my female employees often complained to each other in the break room that their weekend was spent cleaning their houses and they didn’t have time left to recharge. Thus, I decided to look for a local professional cleaning company and signed my employees up for a complimentary biweekly house cleaning. This new perk became a smash hit among Akraya employees as they gained an extra couple of hours to spend on other things.
Respect and trust are two core values your company culture should be built on. Most employees leave a company not because of perks or compensation. They leave (or stay) because of their boss. At Akraya, we promote a culture where the individual is respected. Starting at the very top, the message is that subordinates are treated with respect. We praise in public but criticize (constructively) in private.
Earning and retaining employee trust is also crucial. Employees don't mind if a leader disagrees to a proposal or request. However, if you do agree and then renege when it is time to pay up, you lose their trust.
When thinking of ways to secure and retain talent, spending on high-cost perks is not always the best solution. Instead, focus on building a strong work culture to draw people to your company. As my favorite line from the movie “Field of Dreams” says, “If you build it, they will come.”
Amar Panchal is the co-founder and CEO of Akraya Inc., which he and Sonu Ratra founded in 2002. He brings more than a decade of management, international business development, technology consulting, product management and software engineering experience to the company. Learn more at www.akraya.com.