So today I want to talk to you about your staff and how you reward and recognise the contribution that they make to your business.
Now, it might be that you don’t have any staff yet. It might be something you might be thinking about or you might never need to take any extra help, but that’s okay because what I’m going to talk to you about also applies to individuals, sole traders, one-man bands, because even when your head count is just one, you still need to understand why rewarding and recognizing your own contribution to your business is also important ts success is going to lead to your happiness as well.
So, let’s leap straight in!
You’ll notice that I said we’re going to talk about reward and recognition – this is not just about pay. Everyone’s wired differently and if the only consideration people had when they took a new job used to be, how much do I get paid then we’d all end up chasing the same jobs, but we don’t.
Feeling recognised and well rewarded for the job you do is about so much more than just money, which is why it’s really important to understand what is important to your staff. And yes, that includes all of your one man band when it comes to how you pay your people.
So to make this real, I want you to think about your own reward and recognition package. What do you get out of doing the job that you do? Is it enough to make it feel worthwhile and fulfilling?
Now, the salary part is easy to measure but it might also be about whether you have the ability to earn even more than that with overtime, commission, bonuses and dividends etc. This can be really important because it gives you the opportunity to earn more when you need to or want it. Maybe it’s when you’re saving for holiday or have an unexpected bill to pay for example. And, I know lots of people really like the idea of some kind of performance-related pay.
For example, someone selling cars will earn more the more cars they sell. That can be really motivating for people. But as I mentioned before, we aren’t all wired the same. So there are plenty of people who want to be able to budget from one month to the next. For them, a fixed salary suits them way better than one that might fluctuate.
Now, if that’s you, you might decide, even though it’s your own business, that paying yourself a standard amount every month feels reassuring.Even if your business is flying and you could draw more from it, the comfort of a regular salary can sometimes feel really good.
I know plenty of entrepreneurs who operate like this. They take a view at the end of the year when the accounts are done to either take a bonus or a dividend or to increase their salary for the following year, it all depends on how the business is doing.
Now, as an entrepreneur, that choice may be within your control, but as an employee, it probably isn’t.
So think about how you can help staff who want the security of a fixed income, but also are people you want to incentivise.
You could agree to a monthly amount and then pay bonuses every three, six or 12 months.This would give the individual the ability to earn more, but with the reassurance that their earnings are consistent. Whatever you agree, it can make a huge difference to how that individual performs and how they feel about their job.
So, we’ve talked a bit about money but what else is important under the heading of reward?
Well, I would include holidays, time off, flexible working hours. This isn’t just about people going away for a break, it might be about them being able to manage their childcare or finding the time to continue with a hobby. I’ve got a great example, a friend of mine was allowed to leave work 45 minutes on a Tuesday and a Thursday to go to rugby training. As part of the deal, they went in 30 minutes earlier on a Monday, Wednesday and Friday, right?
He made up the hours, it cost the business nothing and it kept him happy. Would he have been treated the same somewhere else? Maybe, maybe not. But either way, it worked well for both sides.
Flexible working hours or time working from home are difficult to put a monetary value on, but they can make all the difference to how people feel about the job they do and about the company.
Now, I want to touch on the second word that I use right at the beginning – recognition.
Recognition can be as important, sometimes even more so to some people, than reward. So for people who appreciate recognition, increasing their pay is often a bit of a blunt instrument. What they really want is to feel valued, recognised, and acknowledged for doing a good job and being important to the business. They don’t always see money as being the way to do that.
There are loads of ways you could recognise people.
It could be job titles, extra holidays, company car, more responsibility or even things like employee of the month. But whatever you choose, it’s really important that you’re explicit in your recognition. So you need to say things like, you’ve done a great job and we want to thank you with an extra two days holiday. Or, we recognise the value that you’ve added to that project and we want to thank you with the opportunity to head up our next client proposal.
You’ll be amazed at how powerful this kind of recognition can be for the right people, that is, at the right time.
Now I don’t want you just to think that anyone is just a reward or a recognition person, right? They aren’t. Most people will have an amount of money they need to earn or an amount of money that they need and then virtually everybody responds to a thank you and being acknowledged for doing a good job. But if you throw money at people who prefer recognition, not only could you be wasting that money, but you’ll also do very little to make them feel good about their job.
On the flip side, saying thank you to someone who really needs more money to pay the mortgage isn’t going to help them that much either.
So, start by working on yourself. What’s important to you? Is it all about the money? What perks or benefits also matter? How does it make you feel when a customer or colleague thanks you for the effort that you’ve put in, right?
Understanding what makes you tick will help you recognise what makes your staff and your colleagues, potentially even suppliers tick as well. Use the levers of reward and recognition well and you will create an environment that’s happier and much more productive.
Right, hope that’s been useful. I look forward to some feedback on it and I’ll see you next Thursday!