Today's Employee Market Place: Investing in a Culture of Motivation
In today's economy, many companies have been forced into a survival mentality, trimming resources in an effort to creating a leaner and more efficient organization. The adverse by-product of resource reduction, results in employees being asked to do more, faster and with less job security. The paradox, however, is that a company's most valuable asset is their human capital. Top executives and managers must walk a fine line between strategies of efficiency versus the perils of a paranoid and disengaged workforce resulting in de-motivation and higher turnover rates.
Let's for a moment, take into account the following considerations regarding de-motivation and the high cost of turnover:
- 55% of all U.S. workers feel negatively about their current workplace.1
- 79% of employees listed "lack of appreciation" as one of the top reasons they would leave a job.2
- Employee turnover can cost as much as 150% of salary1 with an average sized company experiencing 22.6% turnover rate per year.3 This means that it would cost a company who looses a $50,000 salaried employee, $75,000 to replace them. For a mid-sized company with 1,000 employees that has a 22.6% annul rate of turnover, the annual cost of turnover is $17 million!
The danger becomes to where managers place a greater effort in organizational efficiency to account for increasing constraints, and forgets about the spirit of their employees.
It's important to realize, however, that managers cannot physically make their employees be more motivated. Motivation comes from within - employees must motivate themselves. The most effective approach a manager can take is creating a positive environment, which empowers the employees to feel more valued and appreciated.
Today, more companies are looking to properly executed employee rewards and recognition solutions to provide a means of creating the proper environment which brings about a positive shift in an individual's perceived value and causes repeat behavior.
Think for a moment of the possible ways to motivate an employee:
- Is it money?
- Is it recognition amongst peers?
- Or is it receiving a special gift that they've wanted for a long time?
From a fundamental point of view, offering employee recognition or rewards, creates a closer manager-to-employee relationship allowing the employee to feel value in the overall success of the organization.
Effectively designed and properly implemented incentive programs into the workforce culture can increase individual performance by an average of 22% with team incentives increasing performance by as much as 44%.3
Incentive solutions providers, such as Dallas, Texas-based Company, Online Rewards, has experienced a dramatic increase in the overall demand reward and recognition employee programs within the last 5 years. "Even with the downturn of the economy, top executives at many of the Fortune 500 companies are recognizing the opportunity of investing valuable resources into creating a culture of reward and recognition in their organizations," explains Michael Levy, President at Online Rewards. "Managers are realizing that it is important to engage their existing workforce now, so that when the economy does improve, their employees choose to stay because they feel valued."
1Towers-Perrin, 2003
2Society of Human Resources Management (SHRM)
3Bureaus of Labor & Statistics, 2007