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Archive for June, 2012

KPMG UK Success Story & How to Manage Your Culture through Your Outliers

2012 29 Jun

Recognize This! – You can manage your culture through your people, both positive and negative.

Earlier this month my CEO, Eric Mosley, published an article in Fast Company magazine on the impact of behavioral outliers on your company’s culture. (I shared the story here.)

Now, part 2 of the article has appeared, in which Eric explains in more detail how to use strategic employee recognition to manage these outliers and, through them, your culture.

“Strategic employee recognition refers to those companies that recognize employees on a regular basis, on a massive scale, and in a company whose values are clearly linked to recognition. The behaviors are reinforced across the whole company, shoring up a corporate culture of recognition even more vigorously.

“A program upheld by the employees themselves will help steer a negative behavioral outlier toward the right path, as it becomes clear who is living the values and who is not. Outliers will soon learn which behaviors are encouraged and rewarded. Some may fall in line, some may continue their ways. But the distinction will be made. …

“With a strong culture, senior management does not have to accept damaging behaviors for the sake of profits because the culture will withstand the outlier, and may even encourage him or her to change behaviors. A significant mismatch in “cultural fit” will lead to inherent unhappiness in a negative behavioral outlier, who will likely self-select out of the organization and move on.”

What does this look like in practice?

KPMG UK recently shared their strategic recognition success story in People Management magazine, including in part:

“The programme was named Encore! and was designed to enable managers and staff alike to recognise and reward individuals and teams who demonstrate outstanding performance in accordance with KPMG’s core values and objectives. …

“Since launching the programme in 2008, we have seen a 25 per cent increase in the number of employees receiving recognition awards of their own choosing, as well as an overall reduction in spending on reward. As more staff understand the benefits and objectives of the programme, the level of engagement with Encore! continues to grow – resulting in a 165 per cent increase in the number of rewards given out to date. Our goal is to achieve a further 35 per cent increase by the end of the current financial year. …

“Encore! continues to shape recognition at KPMG and, by enabling employees to reward each other, to transform the firm’s culture.”

What do you do with your behavioral outliers? Do you ignore your negative outliers or do you proactively manage their behaviors to turn them around? What about your positive outliers? Do you appropriately recognize and reward them based on their behaviors and not just their results?

KPMG UK Success Story & How to Manage Your Culture through Your Outliers

2012 29 Jun

Recognize This! – You can manage your culture through your people, both positive and negative.

Earlier this month my CEO, Eric Mosley, published an article in Fast Company magazine on the impact of behavioral outliers on your company’s culture. (I shared the story here.)

Now, part 2 of the article has appeared, in which Eric explains in more detail how to use strategic employee recognition to manage these outliers and, through them, your culture.

“Strategic employee recognition refers to those companies that recognize employees on a regular basis, on a massive scale, and in a company whose values are clearly linked to recognition. The behaviors are reinforced across the whole company, shoring up a corporate culture of recognition even more vigorously.

“A program upheld by the employees themselves will help steer a negative behavioral outlier toward the right path, as it becomes clear who is living the values and who is not. Outliers will soon learn which behaviors are encouraged and rewarded. Some may fall in line, some may continue their ways. But the distinction will be made. …

“With a strong culture, senior management does not have to accept damaging behaviors for the sake of profits because the culture will withstand the outlier, and may even encourage him or her to change behaviors. A significant mismatch in “cultural fit” will lead to inherent unhappiness in a negative behavioral outlier, who will likely self-select out of the organization and move on.”

What does this look like in practice?

KPMG UK recently shared their strategic recognition success story in People Management magazine, including in part:

“The programme was named Encore! and was designed to enable managers and staff alike to recognise and reward individuals and teams who demonstrate outstanding performance in accordance with KPMG’s core values and objectives. …

“Since launching the programme in 2008, we have seen a 25 per cent increase in the number of employees receiving recognition awards of their own choosing, as well as an overall reduction in spending on reward. As more staff understand the benefits and objectives of the programme, the level of engagement with Encore! continues to grow – resulting in a 165 per cent increase in the number of rewards given out to date. Our goal is to achieve a further 35 per cent increase by the end of the current financial year. …

“Encore! continues to shape recognition at KPMG and, by enabling employees to reward each other, to transform the firm’s culture.”

What do you do with your behavioral outliers? Do you ignore your negative outliers or do you proactively manage their behaviors to turn them around? What about your positive outliers? Do you appropriately recognize and reward them based on their behaviors and not just their results?

There Are Only 2 Kinds of Company Culture: Recognition or Repression

2012 28 Jun

Recognize This! – The culture you create in your organization drives every result, positive or negative.

I write often about company culture, especially about the importance of creating a culture of recognition in which employees choose to engage. But let’s take a step back. How many kinds of company cultures are there?

One could argue the number of culture types is infinite. I don’t. I think there are only two:

  1. A culture of repression – This type of culture can take many forms, but the key characteristics include employees who are more focused on advancing their own goals/agendas than the company’s, an air of “why give my opinion because nobody will listen anyway,” and general fear (of management, of bully colleagues, of “sticking your neck out”)
  2. A culture of recognition – In a recognition culture, on the other hand, employees both clearly understand the company’s goals and focus their work to achieve them. Because they’re encouraged to do so, employees far more readily share ideas and innovative thinking, and work in an environment of mutual support.

Mike Sheehan, chief executive of the ad agency Hill Holliday, described these two types of cultures in his own way in a recent New York Times “Corner Office” column:

“I think there are two kinds of cultures, and then you can subdivide them after that. One is based on a foundation of insecurity, fear and chaos, and one is based on a firm platform where people come to work and they’re worried about the work itself. They’re not worried about things that surround the work and are not important. I’ve tried to make Hill Holliday that kind of environment, where people come to work and they’re not worried about their peers shooting them. If leadership doesn’t provide a forum for that kind of behavior, it dies quickly. People forget about it and they just focus on doing their job.

“You don’t want a conflict-free zone, but you want the conflicts to be about the work itself. Sometimes you have to dig a little bit and talk to people, but if you find out the conflict is about the work, then that’s good, because it’s healthy. I think that in a lot of workplaces it’s the opposite — people have to come to a consensus on the work, and so all the conflicts are political.

“That’s one thing that the founder, Jack [Connors], instilled in the culture. It’s not a democracy. You’ve got to make tough decisions and then you’ve got to move on. ‘The enemy’s out there,’ he would say. ‘The enemy’s not in these four walls.’”

Indeed, that last line is the rub. If you have a culture of recognition, you must be willing to protect it by identifying “enemies” that slip inside your four walls and removing them.

What kind of culture do you have?

Recently on Compensation Cafe: Executive Comp, Bonuses, Productivity, Trends in Recognition & More

2012 27 Jun

Today’s post is a quick catch-up on my recent Compensation Café posts. Be sure to click through for the full story.

Executives Would Give Up Incentives for a Little Recognition (27th June 2012)

PwC recently published a quite comprehensive report, “Making executive pay work: The Psychology of Incentives”, on the premise that executive compensation practices are flawed as evidenced by the massive increase in executive pay packages as compared to average employees for seemingly little in return. The key findings of the report are quite interesting, especially the design recommendation: “Money is only part of the deal – and recognition matters as much as financial incentives. Pay is as much about fairness and recognition as it is about incentives. Simpler plans can achieve the recognition benefit with less discount to perceived value.”

If I Don’t Get a Bonus, I Don’t Want the Job (14th June 2012)

Many decades ago, compensation was “a day’s pay for a day’s work.” Then in the mid-20th century, benefits including pensions, medical and insurance got added to the mix. Now, things that used to be bonuses, like …erm… bonuses, are part of a “compensation package.” I get it. I understand this. What I don’t understand is when a set “bonus” becomes an expected entitlement.

Do Incentives Actually Cause Failure? (4th June 2012)

New research suggests the idea of an incentive is a good thing, but once employees get that idea in their heads it can, in fact, hurt their performance. There are instances where incentives can be good for a big goal or a long-term project such as hitting annual sales targets. But for day-to-day encouragement of employees, recognition is a better approach.

Your Total Rewards Investment Is a Waste, Unless… (17th May 2012)

Do you have a Total Rewards strategy? Do you communicate your Total Rewards strategy to all employees in a way that gives them a true sense of your organization’s total investment in them? If you answered “no” to the second question, then by default the real answer to the first question is also “no.” No matter how well defined or constructed your Total Rewards program is, if your employees don’t know about it in terms that matter to them, then your Total Rewards strategy doesn’t really exist.

Productivity Stretched to the Limit: What Next? (7th May 2012)

During the last several years, employee productivity sky-rocketed as employer actions taken during the recession forced longer hours, more work and therefore, more productivity from the average employee. But that can’t last. At some point employers will have to start hiring again to keep pace with a rebounding (if slowly) economy. And that time is now, according to the latest US productivity numbers. Click through to read about what you can do now.

7 Key Trends in Rewards & Recognition (25th April 2012)

The Incentive Research Foundation recently issued a detailed report that compiles and categorizes research from 46 different sources into its “2012 Trends in Rewards & Recognition” report. In this post, I highlighted seven key trends below with excerpts and my own thoughts.

 

Recently on Compensation Cafe: Executive Comp, Bonuses, Productivity, Trends in Recognition & More

2012 27 Jun

Today’s post is a quick catch-up on my recent Compensation Café posts. Be sure to click through for the full story.

Executives Would Give Up Incentives for a Little Recognition (27th June 2012)

PwC recently published a quite comprehensive report, “Making executive pay work: The Psychology of Incentives”, on the premise that executive compensation practices are flawed as evidenced by the massive increase in executive pay packages as compared to average employees for seemingly little in return. The key findings of the report are quite interesting, especially the design recommendation: “Money is only part of the deal – and recognition matters as much as financial incentives. Pay is as much about fairness and recognition as it is about incentives. Simpler plans can achieve the recognition benefit with less discount to perceived value.”

If I Don’t Get a Bonus, I Don’t Want the Job (14th June 2012)

Many decades ago, compensation was “a day’s pay for a day’s work.” Then in the mid-20th century, benefits including pensions, medical and insurance got added to the mix. Now, things that used to be bonuses, like …erm… bonuses, are part of a “compensation package.” I get it. I understand this. What I don’t understand is when a set “bonus” becomes an expected entitlement.

Do Incentives Actually Cause Failure? (4th June 2012)

New research suggests the idea of an incentive is a good thing, but once employees get that idea in their heads it can, in fact, hurt their performance. There are instances where incentives can be good for a big goal or a long-term project such as hitting annual sales targets. But for day-to-day encouragement of employees, recognition is a better approach.

Your Total Rewards Investment Is a Waste, Unless… (17th May 2012)

Do you have a Total Rewards strategy? Do you communicate your Total Rewards strategy to all employees in a way that gives them a true sense of your organization’s total investment in them? If you answered “no” to the second question, then by default the real answer to the first question is also “no.” No matter how well defined or constructed your Total Rewards program is, if your employees don’t know about it in terms that matter to them, then your Total Rewards strategy doesn’t really exist.

Productivity Stretched to the Limit: What Next? (7th May 2012)

During the last several years, employee productivity sky-rocketed as employer actions taken during the recession forced longer hours, more work and therefore, more productivity from the average employee. But that can’t last. At some point employers will have to start hiring again to keep pace with a rebounding (if slowly) economy. And that time is now, according to the latest US productivity numbers. Click through to read about what you can do now.

7 Key Trends in Rewards & Recognition (25th April 2012)

The Incentive Research Foundation recently issued a detailed report that compiles and categorizes research from 46 different sources into its “2012 Trends in Rewards & Recognition” report. In this post, I highlighted seven key trends below with excerpts and my own thoughts.

 

Having Values vs. Knowing Values vs. Living Values

2012 26 Jun

Recognize This! – Your company values do you no good unless employees know how to live them in their daily work.

I think it’s a fairly safe bet to say most companies today have defined set of core values – behaviors and ideals the executive team has invested a good deal of time and effort in defining as the “how” of employee efforts as they work to complete the “what” (results/deliverables).

There is a very great difference, however, in having values, knowing the values and actually living the values in your daily work.

Having Values

What do I mean by having the values? I’m sure many of have worked in (or are currently working in) organizations that require you to carry the company values around as part of your building access badge. Or perhaps you received the values in the employee handbook when you first started with the company.

And there’s this example from an article on the 5 worst employee engagement strategies ever.

“Employee engagement and [recognition] programmes are designed to induce behaviours in employees that will help you grow the business. Running alongside this, you have ‘values’ – a set of shared beliefs that you wish to instil throughout the organisation. They are not one and the same thing.

However, at Kohl’s, many years ago, gratitude was shown by rewarding employees with rubber bracelets. There would be four bracelets in total – your aim was to achieve a full set, each one representing one of the company’s values. It was viewed by many as cheap, and nobody wore them. Kohl’s simply wasted their money by having the rubber bands made in the first place, and created a feeling within the workforce that they were cheap.

Not only were employees somewhat insulted by the gesture, since they didn’t even wear the bracelets it’s unlikely they could even be said to “have” the values.

Knowing the Values

Knowing the values, but not living them, is no better. An example of this comes to us from the Chief Happiness Officer blog, in which author Alexander Kjerulf shared this quote from a recent conference he attended:

You know a corporate values program is doomed to fail when they start printing mouse mats with the values.
- Henrik Burkal, CEO of REMA1000 Denmark

Sure, you can require employees to recite the values to you when they see you in the hall. But reciting them doesn’t mean the individual knows what each of those values looks like in his or her own daily work. Think about a common company value of “integrity.” A worthy value, indeed, but very abstract. This needs to be made real for employees.

Living the Values

One client of ours helps to make this abstract value real for their employees by specifically recognizing and praising them for doing things they might have been punished for in the past. For example: “Steve, thank you for reporting the broken equipment in a timely way. This allowed us to get it repaired and back on-line quickly. You showed great integrity by taking responsibility for the break, communicating to the team how you think such breakage can be avoided in the future, and enabling us all to get back up and running.”

If you want your employees to live your values every day, then make them real. Recognize and reward them – and let them recognize and reward each other – whenever the values are being demonstrated through the work.

Do your employees have your values, know your values, or truly live your values? Do you?

My DriveThruHR Debut: Everything You Need to Know about Employee Recognition in 30 Minutes

2012 25 Jun

Recognize This! – You can learn a lot about recognition done right in just 30 minutes.

Well, it’s not everything you need to know, but I’m impressed with how much ground we were able to cover thanks to William and Byran’s expert guidance. Three weeks ago I had the opportunity to join Bryan Wempen and William Tincup on their DriveThru HR program to discuss employee recognition and rewards. I greatly enjoyed my time with them in what was, indeed, the “fastest 30 minutes in HR” as William describes it.

I’ve embedded the enter episode below and encourage you to listen to for the highlights I feature after the jump.

Listen to internet radio with Wempen and Tincup on Blog Talk Radio

The top 3 themes I hear from our clients today, from companies in the Fortune 500 to companies with 500 employees. I talk about how strategic, social recognition is the key to unlock these three common themes of performance management, employee engagement, and company culture management.

I also discuss how every company has a culture, but it’s hard to change or grow that culture through the traditional vertical communications approach from the top down. Instead, we advocate a horizontal approach to culture change in which, much like the social world, you make all employees the eyes and ears for noticing and celebrating the desired behaviors and outcomes the executive team has identified as critical to organization success.

Other topics I cover include:

  • There is no generational bias for recognition. A survey we did with SHRM proved absolute equality among the generations for their need for recognition.
  • Top talent do, indeed, want to be celebrated, and they are  much more through social recognition messages in which they get a regular beat of recognition from their colleagues and managers alike.
  • How to bring the “water” of frequent, timely, strategic recognition to what is often a recognition desert in today’s workplaces.
  • The tremendous importance of data and how recognition finally brings big data to performance and talent management.
  • The difference between incentives and recognition.

Can You See How Your Employees Live Your Values & Report on It, Too?

2012 22 Jun

Recognize This! – Can you see how your employees are living your company values? LSI can.

I had the honor and privilege of joining Katie Scott, LSI’s director of compensation, for a webinar hosted by HCI yesterday. In the “3 Steps to Accelerating Engagement: The LSI Success Story” webinar (available for replay here), Katie went through their ambition for strategic recognition and the results they realized in just a few short months.

Global Recognition Works

A strongly engineering focused company, LSI is growing globally very rapidly with a very diverse employee population, including a large percentage of employees in India and China. Since one of the questions I’m frequently asked is “does recognition even work in Asia/Pacific countries,” I asked Katie if this was a problem for LSI.

On the contrary, LSI had universal acceptance of the program, though Katie pointed out one area of resistance. Managers with longer tenure were more wedded to their former version of “big bang” recognition – infrequent recognition with a fairly significant cash reward given only for extremely above and beyond behaviors.

Since the new “Catch the Spark” strategic recognition program is more focused on every day appreciation and recognition of employees who live LSI’s values in their daily work, LSI continues to work on re-educating these managers on the power and importance of frequent, timely recognition with much lower-value non-cash rewards.

Non-Cash Recognition Works Better

This approach to non-cash recognition is critical and was a key internal selling point for Katie and her team when presenting their goals for a new recognition program to their executive team. Katie shared a story about that executive meeting. When she was explaining why cash is not king in strategic recognition, one of the SVPs in the meeting said she had just given her subordinate, “Pam,” one of the standard $200 cash awards under the old recognition program (which was distributed through payroll in the regular pay slip). The SVP asked Pam, “What did you do with your reward?”

As is typical, Pam replied, “I didn’t even realize I received it.”

As I’ve said before, cash is transactional, recognition is emotional. They cater to two very different parts of our minds and psyches. Non-cash rewards that don’t disappear in a pay slip create a “stickiness” by creating an emotional, meaningful connection.

Impressive Program Results

The results LSI has achieved in just a few months are very impressive:

  • On target to touch 75-80% of employees with recognition in the first year (which is best practice)
  • Awards distribution is a perfect picture with the highest volume of awards being distributed at the lowest award level, which allows for more frequent, timely recognition with no increase to the program budget (again, this is best practice).
  • “Catch the Spark” has become part of the lingo of LSI and is heard frequently in hallways and meetings when discussing the good work people do.
  • And LSI is able to see how their employees are living the company values. I’ve included below one chart from the presentation. As Katie said: “Being able to show the executive team a pie chart like this that clealry illustrates our number 1 value being lived every day by our employee is customer success – how great is that?”

I do encourage you to watch the entire webinar to hear Katie discuss in more detail how the dynamic program UI catered to their very engineering-oriented culture, how the global rewards structure and multi-lingual platform catered to the unique needs of all employees around the world, and how the measurement and reporting tools directly in the program are driving behavior change.

Can You See How Your Employees Live Your Values & Report on It, Too?

2012 22 Jun

Recognize This! – Can you see how your employees are living your company values? LSI can.

I had the honor and privilege of joining Katie Scott, LSI’s director of compensation, for a webinar hosted by HCI yesterday. In the “3 Steps to Accelerating Engagement: The LSI Success Story” webinar (available for replay here), Katie went through their ambition for strategic recognition and the results they realized in just a few short months.

Global Recognition Works

A strongly engineering focused company, LSI is growing globally very rapidly with a very diverse employee population, including a large percentage of employees in India and China. Since one of the questions I’m frequently asked is “does recognition even work in Asia/Pacific countries,” I asked Katie if this was a problem for LSI.

On the contrary, LSI had universal acceptance of the program, though Katie pointed out one area of resistance. Managers with longer tenure were more wedded to their former version of “big bang” recognition – infrequent recognition with a fairly significant cash reward given only for extremely above and beyond behaviors.

Since the new “Catch the Spark” strategic recognition program is more focused on every day appreciation and recognition of employees who live LSI’s values in their daily work, LSI continues to work on re-educating these managers on the power and importance of frequent, timely recognition with much lower-value non-cash rewards.

Non-Cash Recognition Works Better

This approach to non-cash recognition is critical and was a key internal selling point for Katie and her team when presenting their goals for a new recognition program to their executive team. Katie shared a story about that executive meeting. When she was explaining why cash is not king in strategic recognition, one of the SVPs in the meeting said she had just given her subordinate, “Pam,” one of the standard $200 cash awards under the old recognition program (which was distributed through payroll in the regular pay slip). The SVP asked Pam, “What did you do with your reward?”

As is typical, Pam replied, “I didn’t even realize I received it.”

As I’ve said before, cash is transactional, recognition is emotional. They cater to two very different parts of our minds and psyches. Non-cash rewards that don’t disappear in a pay slip create a “stickiness” by creating an emotional, meaningful connection.

Impressive Program Results

The results LSI has achieved in just a few months are very impressive:

  • On target to touch 75-80% of employees with recognition in the first year (which is best practice)
  • Awards distribution is a perfect picture with the highest volume of awards being distributed at the lowest award level, which allows for more frequent, timely recognition with no increase to the program budget (again, this is best practice).
  • “Catch the Spark” has become part of the lingo of LSI and is heard frequently in hallways and meetings when discussing the good work people do.
  • And LSI is able to see how their employees are living the company values. I’ve included below one chart from the presentation. As Katie said: “Being able to show the executive team a pie chart like this that clealry illustrates our number 1 value being lived every day by our employee is customer success – how great is that?”

I do encourage you to watch the entire webinar to hear Katie discuss in more detail how the dynamic program UI catered to their very engineering-oriented culture, how the global rewards structure and multi-lingual platform catered to the unique needs of all employees around the world, and how the measurement and reporting tools directly in the program are driving behavior change.

A Handbook for Management? Yes, with Advice from the Best

2012 21 Jun

Recognize This! –There are great resources on how to manage better. And now they’re all in one place.

Do you ever wish you could have an easy-to-hand resource of the best management advice from the people you follow in blogs? I know I do. I follow many excellent bloggers and have read and internalized sound management advice over the last many years. Yet there are many times I wish I could have quickly referenced the wisdom of these many others.

Now I can – and so can you. The American Society for Training and Development has just issued a new book that does just this. Edited by Lisa Haneberg, The ASTD Management Development Book brings together the best authors in the space, including some of my personal favorites:

  • Jeffrey Pfeffer
  • Wally Bock
  • Bret Simmons
  • Tony Schwartz
  • Kevin Eikenberry
  • Steve Roesler
  • CV Harquail
  • David Zinger

The book is easy to navigate with sections on fundamental ideas, culture building, teamwork, and management as a social act. Some of my favorite chapters are:

  • The Way We’re Working Isn’t Working: More and More, Less and Less
  • Positively Using Your Power
  • Who Says There’s No Crying in Leadership
  • Are SMART Goals Dumb?
  • Unmanaging the Network

The book is available in hardcover and eBook formats through the ASTD website. I strongly encourage anyone with a desire to improve their management skills (or the skills of others) to read the book … and not just because my CEO Eric Mosley and I are featured in it, too.

You can hear some of this in action today on my webinar this afternoon with Katie Scott, compensation director at LSI. Register now!