Non Financial Awards Non-financial rewards gain value in retaining employees San Antonio Business Journal – by Morrison Woods Date: Sunday, January 26, 1997, 11:00pm CST [pic][pic] One of the most annoying events faced by business owners and managers is hiring a good employee only to have him or her poached by another firm shortly thereafter. This is frustrating under the most favorable of circumstances where large numbers of candidates are available to replace the employee on relatively short notice.However, it is irritating when it occurs during periods of relatively low unemployment like we are currently experiencing in San Antonio. The period of qualified labor scarcity is not going to disappear any time soon. The Texas unemployment rate dropped to 4.
9 percent in October, which is its lowest level in almost 15 years. Similarly, San Antonio’s unemployment rate hit a low of 3. 7 percent. Both these figures went up slightly in November to 5. 3 percent and 4. 0 percent respectively, but demographics indicate a continuing scarcity of qualified workers, especially for entry level positions.Recruitment of new employees by competitors will involve more poaching from current employee pools. This competition for productive employees will continue well into the future.
It is inevitable that your firm will experience staff turnover, and your goal as an owner or manager is to slow the process. So, what can you do as a small business owner to keep your exemplary employees? There are basically two methods for retaining employees: monetary and non-monetary. Skilled employees have come to expect a certain level of monetary rewards such as a good salary, benefits package, and some sort of retirement plan.In order to compete for the most talented workers, both large and small firms need to provide an adequate basic package of financial rewards.
The operative word for small businesses is adequate. Most small businesses cannot compete with large corporations on a monetary level. That’s the bad news.
The good news is that employees’ needs are changing and the non-monetary rewards of a job are gaining greater importance in keeping employees happy and productive. Increasingly, companies must give more attention to the specific needs and circumstances of each employee.Using a mnemonic device, small businesses can use the FIERCE approach to retaining successful employees: Flexibility, Interest, Education, Recognition, Communication, and Equity. Flexibility. Flexibility in dealing with employees is increasingly important in keeping them with your firm. Flexibility takes many forms including flex-time, work-at-home schedules, job sharing and comp time. If a reliable employee who contributes to your bottom line has some extenuating personal circumstances, work with them to come up with a solution that allows them to address those factors while remaining a productive member of your team.Interest.
Showing interest in your employees’ personal, as well as professional, life is another means of holding onto employees. While you do not want to become best friends with employees, there are ways you can express interest in their personal well-being. You can seek their advice about the company’s operations; you can work with them to develop opportunities for advancement within the firm; you can facilitate family leave for those with newborns or aging family members and; most importantly, you can show empathy and understanding for his or her particular situation.Education. Education is another way to keep employees productive and happy.
This education can be formal or informal, but the more systematic it is, the better. You should create a career path for people so they will see themselves as promotable workers. The training they receive — managerial or technical — should be tailored to the company’s needs, but designed for the specific employee. Recognition. While money matters, people also require other rewards for their performance.
Recognition of people’s performance takes two forms: team and individual.When everyone has worked hard to complete a project, throw a little party or take everyone to lunch. There are endless inexpensive ways to recognize people’s value including the simple thank you in the hall. Remember to give the recognition as quickly as possible after the accomplishment takes place. Communication.
Clear, honest, open communication is important in keeping employees interested in the success of your business. This manifests itself in external and internal communications. Every positive message sent to the community about your company has a direct impact on your employees.If your company has a good image, people will want to remain with it. More important, though, is your internal communication.
Make sure employees know your goals, have a clear understanding of their role in achieving those goals, and are provided feedback on how they are helping you achieve them. People who understand what someone is trying to accomplish generally work harder to achieve that objective. Equity. Finally, you need to tie everything together through equity. You must treat all your employees with respect and fairness.
Favoritism is a key factor in undermining the employee retention efforts of companies and must be avoided, not only for motivation reasons, but because of legal considerations. That’s not to say that everyone’s going to receive exactly the same treatment, but there should not be huge discrepancies in treatment over time for similar work that is performed. The books for employee treatment should be kept balanced. Morrison Woods is the director of the Small Business Development Center at the University of Texas at San Antonio.