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Total Rewards and Motivation: Mistakes, Myths and What’s Working

Total Rewards and Motivation: Mistakes, Myths and What’s Working. Laura Wolfe April 27, 2012 - LA SHRM. Objectives. Present new information about total rewards and motivation Cover body of knowledge required for CE credit Provoke you to think in new ways and about new ideas. Big Picture.

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Total Rewards and Motivation: Mistakes, Myths and What’s Working

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  1. Total Rewards and Motivation: Mistakes, Myths and What’s Working Laura Wolfe April 27, 2012 - LA SHRM When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  2. Objectives • Present new information about total rewards and motivation • Cover body of knowledge required for CE credit • Provoke you to think in new ways and about new ideas When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  3. Big Picture When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  4. Total Rewards • monetary & nonmonetary rewards companies use to attract, motivate and retain employees • more than comp & benefits • a philosophy When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  5. Foundational Stuff • Behaviorism • Law of Effect When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  6. Equity Inputs/Outcomes When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  7. Equity • External • Labor markets • Market conditions • Internal When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  8. Org Justice • Distributive • Procedural When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  9. Discussion • Best thing a company has ever done to motivate you? • Is your company using incentive pay plans? • How are they working? • Effective recognition programs? When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  10. Is money the best and ultimate motivator? When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  11. Research • Teresa Amabile and Steven Kramer • Book: The Progress Principle • Support workers’ everyday progress When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  12. Research • Carol Dweck • Book: Mindset • Fixed or growth? When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  13. Research • Dan Pink • Book: Drive • Autonomy, Mastery, Purpose When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  14. www.idonethis.com When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  15. Empowerment • Empowered employees: • Felt worthy, competent, capable • Performed better, more innovative, more job satisfaction, greater commitment, more OCB • Related: • flexible work hours • vacation policies (Netflix) When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  16. Happiness • Frequency, not intensity, of happy experiences more important to creating happiness When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  17. Incentives • Economy a factor • Shifts • Technology When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  18. Incentives & On-time Behavior • Timeliness improved through rewards and recognition program • Computer system to track arrival and departure times and calculate compensation for arriving early • Most workers arrived early when additionally compensated When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  19. Sales Compensation • Proportion of incentive to base • Engage others in design process • Communication • Technology • Planning When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  20. 10 Sales Incentive Design Mistakes • Trying to Keep Everybody Happy • Failing to Separate Novices from Veterans • Negative Reward on High Productivity • Targeting Prizes Toward Entire Sales Force • Planning a Contest with No Sales Force Input When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  21. 10 Sales IncentiveDesign Mistakes • Leaving Top Management Out of the Plan • Being a Do-Gooder • Being Inflexible • Hoping for X While Rewarding Z • Forgetting that Good Salespeople Always Work for Their Own Good First • From HR Daily Advisor When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  22. Executive Compensation • CEO pay and performance • Significant yet modest relationship • Executive boards dynamically adjust current pay according to historical performance When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  23. Executive Compensation • Top Mgt Team turnover impacted by pay dispersion • > the pay differences > likelihood of turnover • Market pay levels and “cut” of total TMT also influence turnover decisions • NBA example ? When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  24. Merit Pay • Advantages • reward key talent • once or recurring • nudges poor performers • Disadvantages • difficult to measure performance • good systems take resources • divisive • communication When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  25. Before PFP Ask: • What is our philosophy? • Where do we want to be? • How does it align? • Do we have: • high performers? • a performance culture • managers able to: • identify high performers • Communicate When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  26. Reward Behaviors, Not Just Results When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  27. Point-based Rewards • Medical center example • Points earned by using shift-scheduling software and for working shifts When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  28. Recognition “Attention is a powerful nutrient. It amplifies and accelerates the situations on which it is focused.” --Martha Beck When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  29. Workplace Recognition Study • 38% tangible rewards • 21% opportunities to learn and grow • 19% verbal or written praise • 20% nothing • 65% of ees b/t 18-34 more likely to leave if they don’t feel like they are recognized • Office Team Survey When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  30. Recognition Blunders • Acknowledging incorrect facts • Offering token gestures • Being vague • Going overboard • Overlooking contributors • Office Team Survey When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  31. Praise • For effort or for ability? • When not to use it. When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  32. Best practices FORTUNE 100 Best Companies to Work For When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  33. Best Practices Zappos When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  34. Best Practices • Discovery Communications • Sprint When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  35. Moving toward Total Rewards • Meeting with Leaders • Permission to align rewards with strategy • Ask for any resources needed to get the project going When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  36. Good Data • Data based planning • Metrics and benchmarking • The big ? When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  37. Benchmark & Metric Data • SHRM • Saratoga Institute • WorldatWork • Consulting firms • Mercer, Hewitt, Hay, Towers Perrin, Watson Wyatt Worldwide • Professional associations • In-house pay surveys When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  38. HR Metrics for Compensation When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  39. Metric Options for Variable Pay • Production performance • Actual change vs. planned change • Revenue growth • Return on investment • Average employee productivity change adapted from Mathis and Jackson, Human Resource Management, 12th edition, Thompson-Southwest When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  40. Metric Options for Variable Pay • Sales Programs • Increase in market share • Customer acquisition rate • Growth of existing customer sales • Customer satisfaction When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  41. Metric Options for Variable Pay • HR Related Program Measures • Employee satisfaction • Turnover costs • Absenteeism cost • Workers’ comp claims • Accident rates When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  42. Cost and ROI of • Health and wellness benefits • Wellness programs • Recognition programs • EAPs • Retirement plans • Time-off programs • Stock purchase When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  43. Alignment Strategic Goals & Objectives • Compensation is not an HR program • Org owns compensation • Appropriate mix of total reward elements • Profit sharing – Nucor Steel When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  44. AlignmentValues • Employee Value Proposition • Rewarding what is valued • Values=culture=strategy When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  45. Keys • Communication • Personalize • Win over family when possible When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  46. Questions ????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  47. ResourcesDan Pink • RSA Animate - Drive: The surprising truth about what motivates us • http://www.youtube.com/watch?v=u6XAPnuFjJc • Drive: The Surprising Truth About What Motivates Us, Riverhead Books, 2009, by Dan Pink • Twitter: @DanPink • http://www.danpink.com/ • https://idonethis.com/ When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  48. Resourceswebsites & blogs • http://www.zappos.com/index0.zml • http://www.ioatwork.com/ • http://www.shrm.org • http://hrdailyadvisor.blr.com/ • http://danariely.com/ • http://www.inc.com/ • http://blogs.hbr.org/ When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  49. Resourceswebinar • SHRM e-learning webinar • Aligning Your Compensation Strategy with Business Priorities byStacey R. Carroll, SPHR, Director of Customer Service & Education, PayScale, Seattle, Wash. • 1.5 strategic CE credit When you’re ready to grow, I’m the one to know. www.CultivateCC.com

  50. ResourcesThe Startup Daily • Play to Your Strengths • http://thestartupdaily.com/2012/02/play-to-your-strengths/ • Why Do You Do What You Do? • http://thestartupdaily.com/2012/02/why-do-you-do-what-you-do/ • The Magic of the Mundane • http://thestartupdaily.com/2012/02/the-magic-of-the-mundane/ • The Cost of Focusing on Results • http://thestartupdaily.com/2011/09/the-cost-of-focusing-on-results/ • Benefit from the Success of Others • http://thestartupdaily.com/2012/02/benefit-from-the-success-of-others/ When you’re ready to grow, I’m the one to know. www.CultivateCC.com

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