Steer and Accelerate Workforce Performance
For many people, except for a paycheck, their work is purposeless. Ask people what they would do if they suddenly won the lottery. The first thing many would say is “Quit my job.” Everyone has their own reasons for wanting to be away from work. In many organizations, change is thwarted and talent is wasted. People go to work and feel little satisfaction. They cannot wait for the weekend where they can avoid the tension and boredom at work. They want to enjoy their life.
Today’s workforce is more diverse than ever. Multinational ethnic groups, young and old all mingle together in a diverse work place, and their interests and needs are just as diverse. Some want more free time while others want more overtime or career advancement. The traditional Total Rewards program is falling short in fulfilling the needs of this diverse workforce.
Total Rewards refers to the monetary and non-monetary rewards provided to employees in exchange for their time, talents, efforts and results. It is intended to attract, motivate and retain employees. Unfortunately much of what is considered the bedrock of total rewards is now seen as entitlements.
Part of this is because many total reward programs are entitlements, not rewards. Competitive pay, vacation, 401K, flex time, training, tuition reimbursement, healthcare and the list goes on. In many organizations, rewards are dished out not for stellar performance, but just for showing up. Well-intentioned managers delay reducing pay for poor performers. Ultimately this rewards mediocrity and punishes top performers. This socialization of rewards has driven up costs, and lowered our competitiveness.
Getting a reward before achievement has occurred is a gift. A reward is something you receive for achievement. You can attract a lot of people by giving things away. However, those with top talent want to be rewarded for their top performance. If mediocrity is rewarded with entitlements, then why work? Workers can just show up and collect their paycheck. If performance is rewarded, people will perform. As Bruce Pfau and Ira Koy say in “The Human Capital Edge,” pay for performance works because it is based in human nature. People do things that are in their best interest. They do not do things that are not in their best interest. As a result some companies have outsourced work to countries where labor costs are lower and the work ethic is higher. But it doesn’t have to be that way.
For many people, except for a paycheck, their work is purposeless. Ask people what they would do if they suddenly won the lottery. The first thing many would say is “Quit my job.” Everyone has their own reasons for wanting to be away from work. In many organizations, change is thwarted and talent is wasted. People go to work and feel little satisfaction. They cannot wait for the weekend where they can avoid the tension and boredom at work. They want to enjoy their life.
Today’s workforce is more diverse than ever. Multinational ethnic groups, young and old all mingle together in a diverse work place, and their interests and needs are just as diverse. Some want more free time while others want more overtime or career advancement. The traditional Total Rewards program is falling short in fulfilling the needs of this diverse workforce.
Total Rewards refers to the monetary and non-monetary rewards provided to employees in exchange for their time, talents, efforts and results. It is intended to attract, motivate and retain employees. Unfortunately much of what is considered the bedrock of total rewards is now seen as entitlements.
Part of this is because many total reward programs are entitlements, not rewards. Competitive pay, vacation, 401K, flex time, training, tuition reimbursement, healthcare and the list goes on. In many organizations, rewards are dished out not for stellar performance, but just for showing up. Well-intentioned managers delay reducing pay for poor performers. Ultimately this rewards mediocrity and punishes top performers. This socialization of rewards has driven up costs, and lowered our competitiveness.
Getting a reward before achievement has occurred is a gift. A reward is something you receive for achievement. You can attract a lot of people by giving things away. However, those with top talent want to be rewarded for their top performance. If mediocrity is rewarded with entitlements, then why work? Workers can just show up and collect their paycheck. If performance is rewarded, people will perform. As Bruce Pfau and Ira Koy say in “The Human Capital Edge,” pay for performance works because it is based in human nature. People do things that are in their best interest. They do not do things that are not in their best interest. As a result some companies have outsourced work to countries where labor costs are lower and the work ethic is higher. But it doesn’t have to be that way.
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