With Tax Reform comes a big opportunity for companies to spread some of the windfall among their employees and shareholders. According to a report by CNN Money, companies such as Jet Blue, AT&T and many others are handing out one-time cash bonuses to their employees. Other corporations are increasing base pay and/or benefits. While this is probably good news for employees, the same can hardly be said for companies.
Unexpected cash bonuses to create goodwill certainly has its advantages—but it doesn’t necessarily equate to higher productivity. Human motivation is much more intricate and complex than what a one-time bonus or wage hike can stimulate. In reality, cash can actually be a disincentive as cited in research conducted at the University of Rochester.
Understanding the effects of bonuses on productivity has been an ongoing challenge for executive and human resource leadership. Intuitively, cash bonuses seem like a good idea. In the short-term, it creates excitement among employees and is a one-time fixed cost that has a known financial impact for an organization. However, research suggests that it does not actually create the long-term impact on employee performance and the productivity most leaders seek.
A study conducted at Intel concluded that a monetary bonus actually caused a 6.5% drop in performance compared to offering no incentive at all.
With U.S. employee disengagement at a staggering 68% according to Gallup, what are the options that will improve performance at work?
Beginning in 2018, corporations will enjoy a tax cut from 35% to 21%. This boon may result in continuing bonuses or increases in wages and benefits year-over-year. However, as companies consider the best ways to leverage this new financial advantage, longer term strategies such as investing in programs that will enhance employee engagement, productivity and organizational culture should be a priority.
Here’s what you can do to develop those long-term plans.
Learn about your people and what motivates them.
People are motivated differently. In a large organization, it’s impossible to laser-focus on individual needs and wants. Keep in mind: people are motivated by a combination of internal and external drivers—which changes from day-to-day.
By providing a blend of motivators throughout your organization, you’ll be able to appeal to things that drive them.
Examples of motivational drivers include career or skill-building opportunities, social recognition, wellbeing initiatives and goal-achievement.
Leverage group engagement tactics to inspire connections across your organization.
Meaningful connection among colleagues is proven to benefit employee wellbeing, quality of work and customer service. Consider integrating memorable experiences as a means of creating this connection, including tactics like corporate events, team celebrations and group volunteering.
Make sure your message is heard.
Now is a great time to review your current communication procedures and tools to ensure they’re adequately supporting your engagement strategy. Investing in a way to provide relevant and timely information on various corporate initiatives will help your employees feel like they’re “in-the-know” and not disconnected—or excluded—from your organizational strategy. Additionally, giving immediate, ongoing and fair individual feedback is also an essential part of gaining employee advocacy. It shows you’re invested in them—which is a foundation to build trust.
Make it easy for employees to engage.
Look around your organization. How many different employee initiatives are you running? If they’re not all integrated onto an interactive platform, you’re missing an opportunity to engage your employees in an enterprise-wide venue.
Combining all employee programs onto a consolidated platform nurtures connectivity through recognition and communication practices that enhance the work experience.
It fosters the sharing of experiences and best practices, creates visibility for team member benefits and can even provide a means of spotlighting role models for others to emulate.
Ensure the effectiveness of your efforts.
HR analytic capabilities are accelerating at a remarkable pace but many organizations are struggling to update manual processes and legacy systems to capitalize on this exciting opportunity. As employee engagement efforts ramp up, it will be critical to ensure you have a plan in place to demonstrate the value of the activities you have in place. The timing is perfect to explore your options for upping your analytics game and making the shift. So when you’re ready, connect with ITA Group and discover what the rewards of a well-rounded engagement solution can do for your team’s wellbeing—and your bottom line.