Despite working from 7 a.m. to 4:30 p.m. in the office as a manager of housewares vendors and then continuing her work in the evening from home, Elizabeth Willet still wasn’t doing enough, according to her Amazon colleagues in Seattle. They reportedly criticized the new mom on the company’s secret feedback tool for not pulling her weight, and even though her boss had approved her schedule. He wouldn’t defend her and she left the company.
That’s one way to treat your workers, and for its many detractors, there are many others who thrive in a competitive environment. But maybe it’s not necessary to go to those extremes to motivate employees.
Amazon was recently outed in a New York Times article claiming that “at Amazon, workers are encouraged to tear apart one another’s ideas in meetings, toil long and late,”and adds that the company boasts of “unreasonably high”standards.
Steven Green, president of TemboSocial, has a different take on employee recognition. His company’s peer recognition system, used by Royal Bank, TD, HP, Kodak and Pfizer, allows employees to recognize each other for good work; it can also be used by managers who still use a more traditional rewards system. We interviewed him about his approach to best practices for employee recognition and engagement.
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What three things should companies do to keep employees happy?
Focus on the employees you have: “One of the mistakes companies make is that they prioritize recruitment over retention,” says Green. “You end up with that leaky bucket situation: ‘We need new people, we need new people, the ones who are here should be happy they have a job,’but that’s not really how it works, people need constant maintenance,” he says.
Or else you risk losing them, which can be a time-consuming and expensive proposition. Admittedly the cost to replace employees varies considerably depending on their field and experience level, but one estimate from Karlyn Borysenko at zenworkplace.com says that it costs 30-50 per cent of an entry-level employees’s annual salary to replace them. The average jumps to about 150 per cent for mid-level employees, and it can take approximately 400 per cent of their salary to replace high-level or specialized employees.
Green speaks from his own experience, referencing the costs his company absorbs every time he needs to find a new software developer, having to navigate a very hot field now where experienced talent have no shortage of options.
When a developer leaves, Green says his company must slow its product development until a replacement is found. It usually takes three months or more to recruit, and up to six months before they’re fully able to work independently on the software. On top of paying a recruitment company 20 per cent of the first year’s salary ($70-$100,000), it takes about 20 hours of HR’s time, plus the two staff developers each spend about 20 hours on the hiring process, which means 20 hours away from their own responsibilities. Green estimates that out of three hires, one may not work out, and so the process starts again.
The pizza lunches are fine, but it’s very possible that everyone is going to be standing around eating pizza that you paid for saying ‘Wow, this company sucks.’ That's not very helpful...
—Steve Green, president of TemboSocial
Regular employee engagement surveys: “Nobody loves doing the survey, but it does help you get a baseline and you can understand what are the issues to focus on,”says Green. “You can have pizza lunches every day, but if people feel that they can never get an idea heard, or in a public company, that they’re not getting the real information internally, those are huge issues.” No amount of pizza will solve that.
Stay surveys: Green says that 60 per cent of the work force would entertain a job offer at any time, and so stay interviews are more worthwhile than exit interviews. “Sit down with people and say: ‘You’re still at your job, how come? Why haven’t you decided to leave?’”
In companies with fewer than 50 people, executives should be interviewing key contributors and managers should be interviewing their employees“but only if the manager has a positive rating from their reports,”he says. “Having a manger who has poor relations with their reports conduct the stay interview may be the trigger for an employee to leave.Stay interviews are effective if they are conducted by people who are 'trusted advisors' within the organization.”
What two things should companies avoid?
Don’t spend money on engagement you can’t measure:“ The pizza lunches are fine, but it’s very possible that everyone is going to be standing around eating pizza that you paid for saying ‘Wow, this company sucks.’ That's not very helpful. You always know why you’re doing them,” says Green.
He gives the example of the head of human resources at a healthcare company who had 40 per cent turnover rate, despite having an annual picnic and giving out T-shirts, mugs and pens to staff. She didn’t allocate the time and resources to find out why people were leaving in droves.
Don’t fear change: If a company has been giving out prizes such as iPads, that program could cost a significant amount every year and not be an effective way to keep people in their jobs. “The mistake is that companies say they’ve always done it this way and they’re hesitant to go back and do the measurement to see whether or not that money is good money,” explains Green.
How can you make a peer recognition system actually work?
It only takes about a minute for an employee to send recognition. The submission will go to the person’s manager and will get posted for others who could learn from that behaviour. People at all points can like and comment back on it and the system will keep generating communications… so the original recognition may be just the first chapter in a larger story, explains Green.
He gives an example of a TD bank employee who works at a regional branch was in line at a burger place, and three teenagers in front of him had bankcards for a competing bank, while the fourth has a card for his bank. The friends teased the boy who had the TD card, pushing him to the back of the line and jokingly said ‘you shouldn’t even be able to eat here.’The bank employee (wearing his bank pin) bought that boy’s lunch. The story generated 67 comments within the peer recognition program, including one complimentary one from the CEO of the bank. Employees can submit examples of their own good work - think volunteering, for example. “In this case, the story resonated with employees and it garnered a lot of peer and manager comments until the CEO became aware of the submission,” says Green.
How do you keep employees aware of their recognition program?
Having a peer recognition program built into the company’s intranet system is key to making sure it’s used, explains Green. “If a company is going to spend hundreds of thousands or millions of dollars on an intranet where employees are going to connect, it’s unrealistic to expect them to start using tools that exist outside that internal system.”
Why prize and points reward systems don’t work
Green references Daniel Pink’s book Drive: The Surprising Truth About What Motivates Us as a great explanation of how recognition programs that use the carrot-and-stick approach evolved from a time when people were doing really soul-crushing, machine-line work.
In the book, Pink explains that autonomy, mastery and purpose are the key to success for creative or conceptual work. Rewards and incentives don’t motivate people to work harder, and in fact can have a negative impact on performance, he says, explaining that social science has proved this over and over, and yet business continues to ignore the findings.
Click here for his interesting TEDtalk on this subject.
Why would anyone want to use a peer recognition system?
Adding to your own social trophy case on your company intranet site has obvious benefits, but writing about your colleagues also makes you look good. “You can be recognized as a valuable employee as well as a good team player,” says Green.
Formerly a social worker, Green says people always want to have a voice. If they feel that they can make a difference to a colleague doing good work, then they’ll give that recognition through the system and be heard.
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