Every business owner knows that honest, hard-working employees are hard to come by. So when you find one, it’s important to maintain a healthy work relationship by showing them that you appreciate their value and view them as an asset.
Although that may seem like an obvious strategy for retaining good workers, a recent article on Bloomberg.com states that “only 36 percent of professionals surveyed by compensation website PayScale believe they are being paid fairly, according to data released in the fall of 2015. A second PayScale report, released in February 2016, shows why that perception poses a problem for managers.”
“When it comes to retaining good employees, pay practices are extremely important,” said Tim Low, senior vice president of marketing at PayScale. Companies surveyed for the website’s recent compensation report cited pay as the No. 1 reason employees chose to leave their jobs, even ahead of “personal issues”, which came in at second place. PayScale surveyed 7,600 executives, business managers, and human resource practitioners in U.S. companies for its report.
Top performing companies use OrangeCRM’s flexible tools to dynamically manage incentive programs, accurately track performance metrics and view comparison analytics on personnel. The OrangeEvent module defines specific actions that comprise an employee reward initiative, traces each of those actions back to the agent and/or team who performed them and establishes various decision pathways by providing multiple performance reports with a side by side Event comparison option and custom views divided by Performance Groups.
Listed below are some of the practices and additional strategies used to prevent the loss of valuable employees and improve overall performance. Thirty percent of the companies in the survey that produced this data were what PayScale called “top performers,” defined as market leaders that exceeded 2015 revenue expectations.
- Embrace transparent communication about pay. Across six categories related to pay transparency, top-performing companies were clearer about pay than were average companies. A previous PayScale report, released in October, found that transparency around pay is an effective way to drive more employee engagement. A survey of 71,000 employees found that 81 percent of employees would feel satisfied with getting paid less than market value for work if their manager took the time to explain the company’s reasoning behind the salary.
- Train managers how to engage with employees about compensation. Only 35 percent of companies surveyed said they train managers on how to engage with employees about compensation. Even fewer companies (17 percent) report being “very confident” in their managers’ abilities to lead a discussion about pay. Nevertheless, it’s important for a company to have the right internal structures to support pay transparency. As stated by Tim Low, senior vice president of marketing at PayScale, “Companies need to make a cultural shift in the way they approach compensation,” because paying out bonuses and giving raises are less effective in retaining workers than explaining a salary and laying out a plausible pathway for an employee to increase salary while at the company.
- Give bonuses. The top-performing companies did more than just talk about pay, said the report. They also rewarded employees based on their contribution to the bottom line. Eighty-one percent of top performers said they give out bonuses, whereas only 74 percent of average companies did. “It’s an important issue for managers to consider,” said Low, “Because there is some emerging thought that says rewarding employee performance can have a higher impact on overall shareholder value.”
- Increase budget for bonuses in 2016. Top performers are also more likely to increase their budget for bonuses in 2016, and give team bonuses, than are average companies.
- Provide a rewards statement for compensation. Nearly half of all top performers reported that they embrace transparent communication around pay and give employees a total rewards statement for compensation, while only 39 percent of companies deemed “average” by PayScale said the same.
For more details and step by step instructions, please visit our online help guide at help.orangecrm.com > OrangeCRM Help Guide > Events.