Performance and Rewards
There’s no questioning the importance of performance and rewards. This system has been a highlight of any corporate structure for nearly a century.
Organizations have become more interconnected, which adds to the overall agility of the company. Lending a hand to other departments is normal, as teams drive the majority of production and management is less involved with daily activities.
One of the most valuable assets in a company is the employees wanting to assist one another. How do you reward and pay team members in a manner that promotes collaboration?
This gets right to the center of the performance and rewards relationship.
Updating How You See Performance
Traditional performance reward is based on solo accomplishments. This falls under the category of performance management. The past has shown us that the highest performing companies reward team goals, not just individuals, but less than one-third of companies practice this ideology.
We also know that keeping to this traditional management process can create significant problems. Only a small majority of companies believe their performance process delivers value, only half have team goals, and less than 2% love their feedback practices.
Additionally, only about 30% of organizations rate managers on their leadership skills. This doesn’t seem quite right, does it?
In the corporate world, the “pay for performance” model is on the rise, and the number one driver of success is the presence of fairness and transparency in pay. Basically, performance management is front-and-center again, but it’s all about setting goals, expectations, focusing, feedback, and growing.
Performance management has become a strategically designed way of knowing how to reward your team members.
Goal clarity should come first in this process. The most important word here is clarity and not goals. Does management know how to help people focus and tell them what not to do? Do they know how to show people where to stop wasting time? This is a matter of management development and tying the PMS system to the business goals themselves.
Many companies have done away with the traditional performance rating. Without a strong feedback system, ratings aren’t nearly as significant. The key to performance management is actual management. This means talking to people and engaging with employees. Getting involved with their daily activities and checking on them is crucial.
Many employees tend to not like ratings, so it only makes sense to do away with them. Not to mention ratings don’t track real-time performance. They’ve been replaced with a process-type system that allows team members to set goals and track them. This makes more sense in terms of actually driving employee performance instead of punishing them with a low rating once per year.
Now, another important question is pay. How do you solve this issue?
This is vital, and in the future of work, it must be reviewed more often and adjusted based on multiple variables. This includes market changes specifically and creating a complete system of transparency.
Many highly successful companies do quarterly reviews and benchmarks for all major roles. Employees also receive the cost-of-living adjustments that are delivered once per year.
Raises are aligned with in-job performance, and pay is high for bonuses that go beyond a job description. There are plenty of opportunities to make changes and be creative with this model.
Career growth is vital in terms of performance and rewards. For most people, the best reward is a promotion. This doesn’t always mean a higher level, but it can mean a new, exciting, and expanded role within the organization. Creating a talent network for career growth is one of the keys to the future of an organization.
Growth is very closely related to customers, projects, and product and services lines. People constantly move around within an organization. In reality, people end up moving up by first moving around. Organizations must have many leadership roles, and obviously, those roles aren’t all for managers.
When you think about priorities, you should think about integrated practices for your organization. Some experts have predicted that one day soon, the management role will cease to exist. AI will play a larger role and change the face of the leadership position as we know it. Sure, AI can help set goals and track success and analyze data.
However, a large part of management is listening, coaching, connection, and being a friend and mentor. Basically, you are a spokesperson for the career of every employee there. Consider yourself an advocate of sorts.
Take a good look at the leadership model of your organization, and make sure you’re rewarding leaders for the real roles they play. The role of each leader should be clearly defined first, then you can move forward accordingly.
When leaders and managers understand how to take a pertinent role in areas of emotion, it becomes much easier to drive performance and clearly outline your rewards system. However, everything must be clearly defined for every position within your organization.
Create a Growth Oriented Workplace
Understanding how to reward managers, teams, individual employees, and every separate rung of the corporate ladder is the key element in play here. The corporate days of old had a uniform system for pretty much everyone within the company. However, the new corporate atmosphere just doesn’t allow for this type of monotony.
A versatile employee is capable of producing versatile results, and this same description should outline an efficient manager. Things can’t be as uniform as they used to be because of the atmosphere of change that’s constantly present in today’s corporate environment. Being flexible and agile in every facet of your developmental and reward strategy is the only way to survive and continue to stay competitive in terms of talent acquisition and employee retention.
We all know the importance of winning the battle of the two latter areas. Normally, the organizations that are victorious in these areas end up being victorious overall and experience long-term success. Are you ready for continuous victories and long-term success? If so, contact us today for a free consultation!