Meeting Employees’ Needs: Culture Management, Engagement, and Preventable Turnover

One of the primary objectives of performance reviews is to ensure that needs are being met—departmental needs, functional needs, organizational needs, and employees’ needs. And there’s the rub. Too often, employees’ needs are overlooked during performance reviews.

Managers focus on other aspects of performance when conducting reviews: whether goals were achieved or not, an employee’s strengths and weaknesses, skill gaps that must be filled, and the like. However, as a recent Harvard Business Review blog post illustrates, it’s a mistake to overlook whether employees’ needs are being met.

In “The Power of Meeting Your Employees’ Needs,” authors Tony Schwartz and Christine Porath reveal the bottom-line benefits of meeting employees’ basic needs, which fall into four categories: 1) renewal (physical); 2) value (emotional); 3) focus (mental); and 4) purpose (spiritual).

Schwartz and Porath write that when any one of these basic needs is being met employees “report a 30% higher capacity to focus, a nearly 50% higher level of engagement, and a 63% greater likelihood to stay at the company.”

(no surprise that #TalentManagement, #EmployeeEngagement, & #Retention are perennial trending topics in HR social media space)

And this positive impact is cumulative, rising with each additional need that gets satisfied. “When all four needs are met, the effect on engagement rises from 50% for one need to 125%.”

The authors conclude: “Rather than trying to forever get more out of their people, companies are far better served by systematically investing in meeting as many of their employees’ core needs as possible, so they’re freed and fueled to bring the best of themselves to work.”

But how do you know what your employees’ needs are? There’s really only one way to be sure. You have to ask them—and the performance review is the perfect time to do so. But this requires managers to engage in a true two-way dialogue with each of their direct reports, not just a one-way discourse on how they’re rating employees. It means being attentive and discussing employees’ needs with respect. It also means managers must be willing to do two key things: first, to give real thought and consideration to what employees are saying; and second, to follow up on these discussions, taking action in a timely manner to get employees’ needs met when appropriate.

Discussing employees’ needs—and what you can do to meet them—not only helps you reap the benefits cited by the authors of the HBR post but it also shows employees that you value them and care about helping them achieve their goals. If you want to create and sustain a high-performance work environment, this kind of open commitment to employees is crucial.

Compensation Reigns as the King of Job Satisfaction

According to a new SHRM research report, Job Satisfaction and Engagement: The Road to Economic Recovery, employees are citing pay as the top contributor to their overall job satisfaction.

The report flies in the face of a body of research that claims compensation isn’t a significant contributor to job satisfaction. SHRM says that 60 percent of surveyed employees rated compensation/pay as “very important,” while another 36 percent rated it “important.” Just two years

ago, compensation was ranked third among contributors to job satisfaction, eclipsed by job security and opportunities to use skills/abilities.

What’s behind the change? A SHRM representative chalked it up to the recession and the slow growth of incomes over the past several years.

Whatever the reason and whatever its rank, compensation is certainly an essential component of job satisfaction. When employees understand how their achievements are valued and rewarded, their motivation and engagement levels improve. This means it behooves us to continually reinforce their understanding and knowledge of our compensation programs. In fact, we should do more than simply educate employees about our compensation programs: we should take steps to make them active participants in these programs.

For example, employees should be responsible for entering and updating their personal information in our HR systems. Naturally, this would require a bit of training and a system that’s extremely user-friendly—but it’s a small price to pay for raising employee satisfaction, motivation and engagement levels.

The right HR information system/software also offers an array of benefits to our organizations:

·      They streamline the administrative tasks related to compensation management.

·      They improve legal compliance and minimize the risk of errors.

·      They diminish manager bias and improve fairness.

·      They help us collect and maintain more accurate people data, which leads to better decision making.

·      And they enhance our ability to share this data easily with functional heads and senior leaders.

Given the findings of the SHRM report, it’s probably a good time to revisit our compensation programs, practices and systems. It could pay big dividends.

A Case Study of Tasty Retention

Retention of your top talent can taste oh-so-sweet...but it requires determination.

This was the point of an article, “Keep Your Top Talent: The Return of Retention,” published recently on SHRM's website. It offers employers this piece of sage advice: “When it comes to sustaining star talent, think like a good coach: Once you land top performers, you must motivate them to stay—and continually raise their game.” The article then goes on to offer suggestions for doing so.

But the true gem of the piece was buried at its conclusion—a mini case study about a catering company that's achieving record retention levels. It opens with these words: "The 200 employees at Chicago's Tasty Catering meet quarterly with managers to answer two questions: What do you want to do differently, and what are your personal desires?"

There’s a mountain of wisdom packed into that single sentence.

Let's start with the fact that Tasty’s managers and employees meet quarterly to talk. They don’t wait for annual performance reviews to roll around to talk turkey. They do it every three months. Next, look at the issues they’re discussing: what to do differently, and what employees personally desire. These issues cut right to the heart of keeping employees engaged and retained for the long term. (Side note: These are also perfect performance review topics, although too many managers would never dream of broaching them.) Basically, Tasty Catering is holding five performance reviews a year with its employees, assuming it also holds separate formal annual reviews as well.

As we’ve long counseled our clients, holding multiple performance reviews, at regular intervals throughout the year, is an essential part of building and maximizing employee engagement. This approach is also invaluable in deploying and promoting employees into roles where they can excel.

Tasty Catering is an example of great performance management—and its results show it. Turnover at the company is less than one percent.

It doesn't get any sweeter than that.

The Art of Effective Performance Reviews

Conducting a great performance review is a bit of an art.

Managers who are just learning this art often ask us what they should be talking about—other than specific performance targets—with their people during reviews. In addition to the fine details (specific performance goals, noteworthy achievements, critical skill gaps, “reach” projects, future potential roles, etc.), we advise managers to ask questions that will help them understand the “big picture” where each individual is concerned.

This is where the “art” of performance reviews enters.

Managers need to ask the right questions and use the right probing techniques to learn the truth about crucial performance-related issues—for example, how employees feel regarding their own performance, the appropriateness of their responsibilities, their interactions with coworkers, their contributions to the department, their commitment to the company itself, and their feelings about the future, among other things.

Interestingly, Forbes recently published an article, 9 Things You Should Tell Your Boss At Your Next Performance Review, which is obviously written as advice for workers. But managers should read the article as well, and consider using a number of its key points to guide their performance review conversations. For instance, the first four items on the list are: 1) what makes you happy; 2) how you want to grow; 3) what you’d really like to work on; and 4) how you envision the future.

These are actually perfect examples of the issues managers should be talking about during reviews (in addition to the more prosaic performance matters noted above). In other words, don’t wait for employees to bring up these topics. Bring them up first by asking your reports about them. Doing so will help you dial into their perspectives, needs and interests—all of which are crucial to effectively managing their performance and developing them. Plus, you’ll send a clear signal that you care about how employees are feeling, not just trying to squeeze the most work out of them. That’s the kind of manager people want to work for.

Address some of the issues covered in the Forbes article and you’ll not only create an artful performance review … but you’ll also go a long way toward creating a meaningful one.

Rethink Employee Engagement -- Already?

Employee engagement continues to be a hot-button issue for employers and HR professionals worldwide.

Some of the questions swirling around this issue include: How, exactly, should we define employee engagement? Does engagement really drive productivity? Are employee satisfaction and happiness part of employee engagement? And, of course, how can we improve our engagement levels?

Last year, Forbes published an article with the provocative title, “It’s Time To Rethink Employee Engagement.” While many organizations had just begun seriously thinking about engagement, the article declared that we already needed to rethink it. To be fair, the author makes a number of points worth considering. For instance, for companies conducting employee engagement surveys: “Don’t treat every opinion the same. Listen to what your top performers tell you. They’ve proved their value and earned their credibility, so go ahead: play favorites.”

Naturally, whether to think (or rethink) about employee engagement is something each organization must evaluate on its own. And there’s plenty of research available to help. (Just cruise through some of our past posts for links to a variety of helpful reports and sources.) But as we all give thought to engagement, here’s a summary of specific items that have the greatest impact on employee engagement, as ranked by 6,000 HR professionals who participated in a 2013 SHRM/Globoforce survey.

• Appreciation by direct supervisor – 71% 
• Opportunity to advance – 41% 
• Salary and bonus – 36% 
• Ability to be effective in one’s job – 35% 
• Company’s care for employees’ well-being – 30% 
• Confidence in executive leadership – 29% 
• Relationship with peers – 22% 
• Belief in company’s mission – 18% 
• Appreciation by peers – 11% 
• Job title – 4% 
• Other – 2%

Again, it’s your decision whether to rethink your organization’s employee engagement. But here’s an interesting quote from William Werhane of Hay Group, the global management consulting firm: “In the current economic environment, high performing organizations have remained focused on employee feedback, and as a result, have achieved significant business results through enhanced levels of employee engagement and enablement.”

That’s something worth thinking about.

Negative Feedback Can Be a Positive Experience

A couple of weeks ago, we published a post examining the myth that everyone hates performance reviews. It referenced a study that looked into how people respond to receiving negative feedback in a performance review.  The upshot: not a lot of folks enjoy negative feedback. Big surprise, eh?

But the fact remains … negative feedback is an inevitable and invaluable part of performance reviews. After all, managers need to let their direct reports know where and when they’re missing the mark. But there are constructive ways of delivering negative feedback.

Here are a few things to keep in mind when it comes time to provide negative feedback to your employees:

·      “The purpose of a fair 360 review is to maximize performance and not punish the employee in any way.” That quote is from an interesting article on the HR Daily Advisor’s website, and even though it’s about 360 degree reviews the point is valid for all performance reviews. The article goes on to remind us that one of the main goals of performance reviews is to boost productivity. That won’t happen if a manager uses reviews to punish, threaten or browbeat employees—even those whose performance is missing the mark.

·      The ultimate goal of performance reviews is to inspire success, not highlight failure. Performance reviews are one of the tools we use to get our people to perform at their best and hit the targets we set for them. In addition to showing them specifically where they’re living up to or exceeding expectations, we also need to show them where they’re falling short. But we need to do so constructively—by offering useful insights, guidance, understanding and patience. We want (and need) our people to succeed. Replacing them is costly and time-consuming. So it’s in our own best interest to inspire and coach them to want to do better, especially during performance reviews that contain negative feedback.

·      Don’t just dwell on the past. Performance reviews offer the perfect opportunity to inspire your people by talking about their future. Think of the signal you send to people when you provide them with fair and necessary negative feedback but then move onto discussing their future (the kinds of roles and work they want to take on in the next three to five years, the kinds of learning and development resources they’re interested in, etc.). You’re showing them that there is still a place for them within the company, despite temporary performance hiccups, if they raise the bar.

It all comes down to this: performance reviews are only as effective as we allow them to be. If we do a poor job of delivering negative feedback—or positive feedback, for that matter—the review won’t do our people or our organizations much good.

If we learn to inspire success and ignite the desire to do better in our people, then the performance review can be a truly transformational experience.

Let’s Not Panic Over the Quit Rate. But Let’s Not Ignore It.

New data shows that workers are not afraid to leave their employers, even during economically challenging times like these.

The U.S. Labor Department recently reported that roughly 2.4 million American workers quit their jobs in November of 2013. More remarkably, the percentage of workers resigning from their jobs—known as the “quit rate”—is now higher than it was before the recession: America’s quit rate was 1.8% in November 2013 … up from 1.2% in September 2009.

Okay, there’s no need to push the panic button. A significant share of this spike in the quit rate came from low-wage jobs in the food services and retail industries. Even so, the quit rate should serve as a useful reminder to all of us about the importance of retaining our top talent. After all, they’re the most valuable workers we have. They’re also the ones who have the most employment options and, therefore, the easiest time walking out the door.

We now know that today’s employees are motivated to remain loyal to their employers through a complex mix of intrinsic and extrinsic factors. Intrinsic factors include how connected they are to their work, the sense of fulfillment and pride they get from their work, and the feeling that they are making a valuable and valued contribution to the organization, among others. Extrinsic factors include compensation, non-cash rewards, performance reviews, promotions and demotions, and the like.

Of course, savvy employers address all of these factors and the corporate world has given more and more attention to the intrinsic factors they once ignored. Many employers, for example, are building employee engagement levels by giving workers more mentoring, offering them exciting “stretch” assignments, and giving employees roles and responsibilities that are more closely aligned with their personal career objectives.

At the end of the day, retaining our top talent is all about rewarding and compensating them effectively. And that means much more than “paying” them appropriately. The most effective rewards strategies are total rewards strategies, which encompass compensation, benefits, learning and development, career advancement opportunities, and more.

If you’re interested in reading more about total rewards strategies that can help your organization retain its top performers, download a copy of our white paper, “Put Your Money Where the Motivation Is: Compensation Strategies to Retain Your Best People.”

Hating on Performance Reviews—and the Old Switcheroo

"Study finds that basically every single person hates performance reviews.”

With a headline like that, it’s no wonder a recent Washington Post article continues to get attention. The problem is it’s not true—not even according to the research the article cites as its

source.

The research was conducted by psychologists at Kansas State University, Eastern Kentucky University and Texas A&M University, who “looked into how people respond to negative feedback they receive in a performance review,” according to the article. It also says the researchers “asked 234 staffers at a large southwestern university to rate their feelings about a performance review they received three months earlier.”

Based on those facts, it’s a little difficult to understand how the Washington Post can justify the headline it ran. Okay, it’s VERY difficult to understand. But we definitely understand why they ran it: it’s a sure-fire attention grabber. It’s like a lot of recent headlines that hate on performance reviews.

Although it seems fairly obvious, we’d like to point out that there’s a significant gap between everyone hating performance reviews and a few statistics showing 234 individuals at one university generally don’t like getting negative feedback during a review (who does?) and some portion also disliking a recent review.

If this research does highlight anything it’s not that everyone despises performance reviews. It’s that many managers continue to do a less than stellar job of conducting reviews. If they truly want to help drive employee performance effectively, managers need to learn to be more constructive, guiding and mentoring—even when they’re providing negative feedback.

The Washington Post article is really just the latest in a long line of articles that pull the old headline switcheroo. Dozens of pundits and bloggers have written headlines like, “It’s Time To Eliminate Performance Reviews,” and then offered advice on how to conduct performance reviews properly. Clearly, it’s a popular attention-getting device.

Even so, performance reviews continue to be a necessary and effective tool for helping our employees grow, develop and even excel. But we need to conduct reviews appropriately and in ways that reinforce our employees’ commitment to doing the best work they can.

To read more about performance review best practices and how to rethink your appraisal process, download our white paper, From Dread to Moving Ahead - Taking the Pain Out of Performance Management.

Development On Demand — Improving Employee Adoption of an Integrated Learning Management System

HR organizations understand the important role that a Learning Management System (LMS) can play in increasing the knowledge base of their workforce. And moving the learning experience online makes good business sense — a well-implemented LMS can potentially enable 25 to 35 percent improvement in learning operational effectiveness and efficiency.[1]

 

In many organizations, however, the overall effectiveness of e-learning delivered through an LMS remains an issue because of low user adoption of the system. Why? The reasons are many — it may be due to a lack of integration of e-learning into the wider learning and talent management strategy, insufficient planning, or a poor user experience reported with the LMS technology. Failing to achieve prolific user adoption will prevent the organization from achieving the best possible ROI of the LMS technology, and can result in:

·        Low or limited employee usage

·        Users expressing frustration and experiencing difficulty with the new system

·        Poor performance results at the individual and division level

Despite these risks, implementing an integrated LMS can fundamentally change the business and improve the ability of individuals or groups to do their jobs. Before going forward with implementation, take into consideration the following key factors for the greatest success of an integrated LMS — culture, communication and customers.

 

Culture. Give plenty of thought to the readiness of your organization for accepting the new system:

·        Do executives and line managers support the new technology, and how will they visibly promote the importance of its use? Getting active buy-in from the leaders of your organization can address perceived concerns over the value of the new system.

·        Prepare employees for the differences they’ll experience between traditional classroom learning and e-learning. E-learning through an LMS emphasizes that the employee is responsible for their own learning, and some employees may not be equipped with the discipline necessary to complete online coursework. Unleash your LMS internal champions to help employees understand the value an LMS will bring to their role and their career aspirations.

Communication. Prepare and evangelize a PR and communication plan for your LMS implementation early on, and use different mediums to spread the word and inform your audience. But be wary of over-engineering your communication strategy. As Mark Twain once said, “The more you explain it, the more I don’t understand it.” Keep communications simple and straightforward, and talk about what your audience will find meaningful rather than what’s important to you. Tap into your company’s intranet or internal social media channels to generate learning and development discussion and spark conversations with your internal community.

Customers. Consider the “personas” of who will interact with the system, what they will uniquely need to be successful, and how the LMS will help them improve and grow in their career. When the LMS is fully integrated with the organization’s broader talent management strategy and performance management systems, your employees will see compounding benefits and a “familiarity of use” from these learning tools. For example, an LMS can bridge information from the employee’s performance appraisal to the creation of a customized development plan. When e-learning coursework and activities are specifically targeted to grow competencies or improve performance, the employee will be positively reinforced for completing their learning and development plans when performance improvement is recognized and rewarded in subsequent reviews. And with rich, Web-based e-learning content available online, employees can access and integrate learning activities into their work at their moment of need, wherever they may be.    

A fully integrated Learning Management System is a smart investment for any company looking to boost organizational performance. Before unveiling a new system in your company, create a detailed user adoption plan to ensure that your implementation garners a positive reception from everyone in the company.

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[1] Clarey, Janet. Choosing an LMS: Differentiating the Needs of the SMB Market. Bersin & Associates. August 2011.

Forget Policies and Paperwork — the 5 Things Business Leaders Really Want From HR

Read beyond the headlines of any leading Human Resources or C-suite trade journal, and you’ll understand why talent has replaced technology to become the game changer for edging out competition in the 21st century. Despite the dialogue and debates covering this trend, one lingering question continues to raise the hackles of both business leaders and Human Resources practitioners — who takes primary ownership for acquiring and developing the arsenal of talent within the organization?    

It’s a classic chicken-and-egg story. Line managers can create the greatest positive impact on employee engagement and performance, but only if they are provided with the right tools and support to effectively lead their teams.  

The most successful HR professionals are moving beyond paperwork and policies and stepping forward into more strategic roles to deliver what business leaders need most today:

1.      Bold Innovator. It’s considered “table stakes” for HR to have the fundamentals of core services like benefits administration, compensation and compliance nailed down. While these processes are necessary to any business, they do little to support breakthrough performance or results. To deliver more value, the human resources function needs to spend more time accelerating operational improvement.[1] Forget turf-protecting activities that quash outside-the-box workforce management ideas; instead, HR should work closely with business leaders to help incubate pilot programs that have the potential to improve products, services or results.

2.      Talent Consultant. Outperforming today requires that managers have greater insight into every aspect of the business, including their people. Human Resources can deliver tremendous value by providing best practices in performance management, acting as the gatekeeper of cultural development trends, and providing relevant analytics and quantitative data to help managers gain efficiency and make better decisions.

3.      Trusted Adviser. Managing a team of people is challenging, even for seasoned leaders. When dealing with unique personalities, performance and work preferences, managers often feel they need to be all things to all people. What they really need is an objective consultant who can support their development to be the best leader possible. HR business partners earn respect as trusted leadership advisers when they provide constructive guidance that’s candid, honest and substantive. By asking for and responding to feedback in return, the HR practitioner also models and reinforces effective coaching techniques for the business leader.  

4.      Credible Expert. Backing up their deep and broad functional expertise, HR professionals must also have good business acumen and a sound understanding of their organization’s vision. With this blend of knowledge and experience, Human Resources can forge the critical link between the strategy of the business and the identification and development of talent to meet those needs. But earning a reputation as a credible expert among the management team doesn’t come easy. It requires HR partners to demonstrate:

·        Leadership courage under pressure

·        Unwavering conviction to champion employees

·        A sense of urgency in their actions

·        Commitment to achieving results

5.      Solution Strategist. More than anything, managers value HR partners who can help them achieve success for their teams. When involved in operational meetings or strategy sessions, they want HR to present relevant, straightforward and streamlined solutions, not risk-avoidance barriers or complicated science projects. HR professionals can lead through complexities by clarifying situations, distilling scenarios down to their root cause, and focusing on innovative outcomes that benefit both the business and its employees.

What do business leaders want from HR? Control over the tactical administration that comes with the role, yes. But there’s also a seat at the proverbial executive table for Human Resources professionals who embrace their strategic role as business leaders rather than policy practitioners.

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[1] Power, Brad. Focus HR on Process Improvement. Harvard Business Review. February 2012.

MY REVIEW OF MY MANAGER WILL JUST SIT IN HIS (OR HER) DESK DRAWER

“And I Should Give You My Feedback Why, Exactly?”

OK, OK. We know you get it. You’ve heard it from speakers on the talent management circuit long enough. You’ve read it in enough academic blog posts and best-practice-type white papers.

You know by now that the most effective performance review systems include assessments of managers from their direct reports.

Yeah. Right. Like everyone in your organization believes that’s going to happen. Never mind it will occur with any sort of frank, open and productive communication.

Why are they so skeptical? Why might your organization be among those that won’t benefit optimally from authentic and effective 360 degree reviews for managers?

If your company is like most, one big reason is that too many employees think their managers will simply ignore their feedback, that it will sit in the manager’s metaphorical desk drawer, never to see the light of day again. Other reasons are that direct reports:

·        Don’t believe that their assessments of their managers will ever receive serious consideration from the manager’s supervisor.

·        Doubt their feedback will result in concrete suggestions for performance improvement that will help their manager grow and, in turn, improve things for the direct report.

In short, too many employees simply can’t wrap their heads around what an integrated talent development and performance management system is all about.

And why can’t they get past thinking that their feedback simply ain’t goin’ nowhere, as the folk tune says? Because for them to get a handle on the true potential of manager assessments, direct reports need to understand:

·        How those assessments relate to talent mobility throughout the organization

·        Why managers need to send performance management up the ladder for everyone on their team, including themselves

Call them tricks, call them hints, or call them key features of a best-practice integrated talent-development system, but here are four components to achieving buy-in and engagement for manager assessments:

1.      Encouraging open conversations up and down the ladder regarding each person’s skills and potential, and about what the organization needs

2.      Engaging in frank discussions between managers and employees about the manager’s performance

3.      Moving managers and their direct reports seamlessly from one job to the next, vertically and horizontally, and across business, function and geographic lines

4.      Making talent decisions based on an alignment of each person’s capabilities and aspirations

On the other hand, ignoring the fundamentals raises the risk that employees will continue to believe their feedback will be ignored, forgotten and left sitting in a virtual desk drawer collecting dust.

HONEST FEEDBACK ABOUT MY MANAGER

"Come, Give Me Your Feedback"

You have a pretty solid relationship with your boss. Even so, why does it feel like an invitation to jump aboard the Terror Train when he asks, “So, how am I doing?” You hope the invitation is offered with his genuine openness to feedback, but do you really know what lies beyond his call?

Many companies support 360 degree reviews for managers, with an intent to draw out honest feedback from a broad perspective, including direct reports who are inherently reluctant to participate in the process because:

       ·        They’re cynical about whether feedback is truly kept confidential

       ·        They fear their comments will come back to haunt them during their own reviews

·                They wonder if the manager will be held accountable for follow-up and long-term improvement

Feedback from direct reports can provide managers with invaluable insight and provide specific and concrete examples of performance upon which to focus development. If your organization uses 360 degree reviews, help employees prepare for their role in the process:

·        Communicate — Create awareness for the overall performance management program with a steady drumbeat of employee communications. Start from the top of the organization and send clear messages regarding participation, process and timing.

·        Cascade — Model support of the performance management process and activities from the top down. When managers themselves first experience the process of providing upward feedback, they’ll be more effective in cascading the process down the organization.   

·        Clarify — Clearly explain the process of handling feedback. Is the feedback kept confidential and anonymous? Is the process open and transparent, involving a face-to-face meeting with the manager? Address these questions early on and you’ll alleviate employee concerns.

·        Commit — Managers should create specific action plans to address performance gaps identified in feedback. Action plans should be shared with direct reports, with progress discussed at regular intervals throughout the following year.

·        Culture — Most important, consider your company’s culture when introducing 360 degree reviews to your organization. Take an approach based on best practices, and tailor your program to meet the unique needs of your people. Anything less may make them Scream.