Exec Brief Recession Na


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Its a good read - Free download from the GLOBOFORCE website. give you a different perspective on how to manage employee\'s.

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Exec Brief Recession Na

  1. 1. The Power of recogniTion To overcome recession fears As the news about the state of the economy continues in a nega- cally to ensure the company has the right people in the right jobs tive tone, employees around the world are becoming more con- when the market turns. cerned about job security as employers look to cut expenses while This strategy will help the company rebound more quickly than maintaining performance. But these fears and cuts begin a cycle of those that did a less considered layoff. Employees have long mem- discontent that will be challenging to overcome once the economy ories. Those who make it through layoffs are often the most tal- begins to improve. In the recent article “Psychological Recession,” ented high performers companies want to keep. However, once the author Judith M. Bardwick defines the term as “an emotional state market recovers, those employees will remember how the company in which people feel extremely vulnerable and afraid for their fu- treated them and their less fortunate colleagues and may be the tures.” She goes on to explain the effect, “Chronically fearful peo- first to consider leaving for a more appreciative work culture. ple are too exhausted to be creative and innovative. They expect the worst to happen, so they see no reason to give their all.” Using strategic recognition to reengage employees An ailing economy exacerbates these feelings, resulting in a greater As employees worry more about keeping their jobs, their ability to percentage of disengaged employees than during times of plenty. focus on the job at hand tends to slip. Bill Catlette of Contented In their 2007-2008 global workforce study, Towers Perrin reported Cow Partners and co-author of the Contented Cows book series, that almost four out of five workers are not performing at their opti- recently commented: “It seems likely that an ailing economy will mal level, with two out of five “checked out.” The impact on com- cause many organizations to ‘lean down’ their spending in the tra- pany performance is substantial. Companies with high employee ditional comp[ensation] and benefits areas for a while. We will be engagement show a 19.2% increase in operating income while more reticent than usual to add to the fixed cost structure. With low-engagement companies show a drop of 32.7%. With a poten- growing acceptance that a focused, fired up workforce really does tial 50% differential in operating income on the line, engaging em- lead to improved outcomes, we will, however, likely see enhanced ployees becomes critical for company success – especially when a focus on performance-based recognition and reward programs.” company is struggling for margins during an economic downturn. These five critical steps can help you reengage your employees in impact of an ailing economy on employee Productivity their daily activities and boost company performance during dis- tressing economic times. Today’s savvy employee knows no job is guaranteed, especially when the economy turns sour. However, many companies are re- 1) see your employees as assets, not costs. porting simply making reductions in force is not a viable option. After cutting resources deeply during the last downturn, human Your employees are both assets and stakeholders in the success of resources leaders are now positioning themselves more strategi- the company. By engaging them fully in their work, leadership can © 2008 Globoforce Ltd. All rights reserved 144 Turnpike Road, Suite 310, Southborough, MA, 01772 USA. t: +1 888 743 6723 f: +1 508 357 8964 e: info@globoforce.com www.globoforce.com
  2. 2. 4) Boost performance through recognition when merit increases derive additional value from their efforts. Clearly define employee- become cost prohibitive. specific roles and expectations that are tied to overall department, division or company goals. According to Martha Finney, author of Consistent, appropriate and frequent recognition encourages employ- The Truth about Getting the Best from People, “People who are en- ees to perform at a higher level. A University of Chicago study found gaged in their work are personally invested in your company’s mis- subjects working for a non-cash incentive increased performance by sion-critical objectives, and that shows up in cutting-edge innovation, 39%, compared to those working for a cash reward who improved unparalleled customer service and the kind of emotional resilience by only 15%. The return on investment from a small recognition that will withstand any storm your business will have to weather.” budget—best practice suggests at least 1% of payroll—tends to be considerably higher than the return from stretched annual merit in- 2) Let your employees know they and their work make a difference. creases. After reducing annual increases to the minimum, companies can reinforce the psychological contract with employees with a well In the stressful and uncertain environment created when economic considered recognition program. Such a program feeds an employee’s conditions take a turn for the worse, it becomes critical to reinforce for need for Psychic Income™, which is the additional value they derive employees the difference they make every day in helping the company from increased social acceptance, self-esteem and self realization. meet and exceed its goals. Communicate this effectively through a strategic recognition program explicitly linking company values and 5) optimize strategy execution through reinforcement of effec- goals to the employee behaviors and actions being recognized. Fre- tive implementation steps. quent and appropriate recognition helps employees see how their ef- fort is delivering on company goals and mirroring company values. A tough economy removes the cushion companies have become accustomed to in times of growth. There is no longer any margin 3) counter employee confusion and discontent over actions for error or delay in executing on a company’s strategic objectives. such as layoffs or reorganizations with constant communication. A recognition program based on the company’s strategy helps em- ployees clearly understand the goals and encourages and rewards During an ailing economy when employees tend to focus more on them for effective implementation. personal concerns for job security than on the task at hand, keep all employees, not just your star performers, engaged in daily efforts by Are you in need of a program to reinforce your company’s strat- communicating the reality of the situation, but with a tone of hope. egy to bring you through today’s slowing economy? Our experts Delivering bad news honestly and in a straightforward manner helps are ready to help you engage your employees through meaningful to ease fears. Communicating the objectives and vision of a company recognition efforts that clearly communicate your commitment to during a downturn can provide a sense of security. Make your com- them and their success. Visit us on the web at www.globoforce.com mitment to your employees clear by keeping a strategic recognition or email us at corporate@globoforce.com. To speak to one of our program in place and running smoothly, rewarding them for actions global consultants immediately, please call: +1 888-7-GFORCE. aligned with the objectives and vision. about globoforce Globoforce is the leading worldwide provider of on-demand strategic reward and recognition solutions for Global 2000 companies. Globoforce’s flexible and efficient recognition tool can scale from one user to millions of users with ease, offering global companies a powerful and secure solution to implement and manage their companywide or divisional employee recognition programs. Through a dynamic, easy-to-use, on-demand technology platform, Globoforce transforms the way companies engage, motivate and empower their workforces across the world. Co-headquartered in Southborough, Mass., and Dublin, Ireland, Globoforce was recently selected by the Great Place to Work® Institute as one of the “50 Best Com- panies to Work For.” Globoforce won a 2007 Process Innovation Award for the creative deployment of Dow Chemical’s global, on-demand employee recognition program. Globoforce also won Human Resource Executive magazine’s coveted “Top HR Product of the Year” award in 2004 for its revolutionary on-demand software solution. Some of Globoforce’s world- class customers utilizing this enterprise-class solution include Amgen, Avnet, Dow Chemical, Intuit, Procter & Gamble and Reuters. www.globoforce.com. © 2008 Globoforce Ltd. All rights reserved 2