A carrot is better than a stick in optimising your workforce. That carrot may be cash, time or other aspects of work culture, writes FIONA REDDAN
YOU CAN FORGET about company cars, fancy stock options and international travel. When it comes to motivating employees, it all comes down to the basics – salary and amount of holidays. And in the current environment, job security is also a top priority.
In a recent survey from recruitment firm HRM, which polled more than 10,000 middle managers and senior staff all over Ireland, after salary and bonuses, the amount of annual leave a company offers was found to be the most attractive aspect of an organisation for an employee.
The survey also reveals an interesting insight into what motivates employees working in different sectors. For example, professionals in the legal, IT, human resources, science and finance sectors indicate that amount of annual leave is their second-highest influencing factor behind salary. Engineers, on the other hand, with a steady eye on the future, rank pension contributions as their second-biggest motivator.
And while salaries might have come out on top in the survey, Graham Morris, managing director of the HRM group, notes that there has been a shift from compensation towards more work/life development issues, given the current environment.
“With less disposable income available, people question more than just rates of pay,” he says. Indeed organisational stability was identified by executives in the survey as the top factor in deciding where they want to continue their career.
David Walsh, chief executive and co-founder of Irish property protection services firm Netwatch, agrees.
“If you look back five or six years ago, salary was number one. But now what people want is job security,” he says, drawing on his recent recruiting experiences. The firm is set to hire an additional 50 people this year.
Indeed the good news for companies is that motivating staff doesn’t have to be just about increasing salaries or bonuses. Non-cash motivators are also critical.
A survey from McKinsey, for example, found that praise from immediate managers, leadership attention (for example, one-on-one conversations) and a chance to lead projects or task forces, were no less or even more effective motivators than the three highest-rated financial incentives.
This rings true for Helen Tynan, head of human resources for Google Ireland. She argues that opting only for monetary rewards is not enough when it comes to attracting and retaining top talent.
“You will not retain your best people if you only reward them through remuneration,” she says. In this regard, she notes that Google fosters a “strong feedback culture” while career development is also a key focus.
“We look at developing career paths for everyone, and a great deal of learning and development support and management support is dedicated to career development,” she says.
Successful organisations are also those that give more choice and autonomy to employees when it comes to making decisions around benefits that are important to them, personally.
“It’s not a one-size-fits-all approach,” notes Morris.
At Netwatch, for example, staff have been asked what they would like, and incentives now include a subsidised gym membership which was a top priority.
“I think some companies force incentives on staff that they don’t want – or would prefer something else,” notes Walsh.
The rise of the Blackberry “24-hour on” culture can also be used as a tool to motivate employees, by allowing them more flexibility in terms of working hours, provided that they are still in touch with the office.
However, it can also serve to demotivate, by preventing employees from getting a clear break from work.
Suprisingly, while you might expect this 24-hour working culture to be in evidence at a tech company like Google, it’s not the case says Tynan.
“Holidays are holidays: we firmly believe that when ‘Googlers’ are off they are off and we do not expect them to answer phones or emails when they should be spending time relaxing and having fun,” she says, adding: “We focus on rewarding people through their work/life balance as well as their bank balance.”
But for companies looking to make their incentives work for them as well as their employees, motivating staff isn’t just about setting aside a budget to cover little perks – it’s about aligning the interests of the employee with those of the company.
At Netwatch, for example, how staff will be incentivised starts during the recruitment process, when potential employees are assessed by psychological profiling.
“We want to make sure there’s a culture fit between the personality of the person and the culture of Netwatch,” says Walsh, who recalls reading the quotation “beatings will continue until morale improves” some 20 years ago. He decided to take the opposite approach to motivating his workforce, which now numbers about 100.
“It just doesn’t work,” he says, “it has to be authentic within an organisation. We deliberately employ very intelligent people and everything we need to do has to be authentic because these people will see through it.
“If we want to project ourselves as being a caring organsation externally, then we need to mirror that experience internally.”
He points out that staff barbecues, to which employees’ families are also invited, are a frequent occurence.
At Google, it all ties into the company’s culture also. “We emphasise our values in everything we do and focus on attracting people with a similar value set,” says Tynan, adding that the company looks for people who are “not afraid to challenge, innovate and lead”.
Google is also known for thinking outside the box in its business, and this is also evident from its incentives package.
Indeed, it has teams dedicated to coming up with new ideas for benefits and incentives for employees.
Some of these ideas include subsidised massages, a new parent takeaway allowance, to cover the cost of takeaway meals in the first month for new parents, and subsidised Weight Watcher classes.
Unsurprisingly, the firm also incentivises innovation, and a patent bonus rewards Google’s staff who come up with “great, patentable ideas, and provides them with resources to prototype their ideas”.
If you look back five or six years ago, salary was number one. But now what people want is job security
What motivates employees (in order of preference)
1. Salary
2. Amount of annual leave
3. Performance bonus
4. Pension contribution
5. Health cover
6. Provision of sick pay
7. Life assurance
8. Share options
9. Company car
Source: HRM