“Just show me the money.” vs. “Nobody notices or appreciates the work I do. Why should I bother?”
Just another way of saying cash vs. non-cash rewards. Let me make this really simple. Cash does not motivate, it does not recognize, it does not appreciate. Cash compensates. Pure and simple.
And that’s not a bad thing. The media spin on recent research from Mercer tries to make it seem that way with headlines that scream: “Forget non-cash compensation: employees say ‘show me the money.’” If you read more deeply into the article you see this: “Leading reward elements perceived to have the strongest impact on employee retention and engagement for 2010 are base salary increases (41%)…”
This isn’t surprising. Quite a few companies need to increase base salary to return employees to level they were earning in 2008, much less give them a raise. That’s the realities of recovering from the actions taken in the recession when salary cuts and wage freezes seemed the norm.
But that doesn’t mean non-cash employee recognition and rewards will fall off in the coming months. As I said in my post on Compensation Café on Wednesday, you must build a solid foundation with appropriate, fair and livable base compensation. But once that’s done, you must then add the polish with recognition programs.
Another recent study from the Boston Consulting Group and the World Federation of People Management Associations showed that executives believe these areas are especially weak at their companies:
• Structured career management that rewards appropriate behaviors
• Recognition beyond compensation
The executives are right, buy why should they (or you) care? Another “SmartPulse” survey conducted by SmartBrief on Leadership released just two weeks ago asked: “What’s the most satisfying reward you can receive for a job well done?”
Cash seemed to win out at 30%. But when you add together 30% for “Praise and expressions of thanks from my team and customers,” 28% for “A handwritten thank you note from an executive/leader I respect,” and another 8% for “Public accolades and awards at a company awards ceremony,” that 66% craving appreciation in some form is more than double those who vote for just cash.
If you think just a couple percentage point raise is going to convey to your employees any level of appreciation, respect and desire to keep them (and their talent) loyal to your firm, think again.