Sasan Saeidi, Global Client Leader - Nestlé at Wunderman Thompson Global and Global Senior Vice President of the International Advertising Association, on how organizations need to find better ways to reward their talents.
There is a famous dialogue between the CFO & the CEO that you have perhaps heard before:
- CFO: What happens if we train our people and they leave tomorrow?
- CEO: What happens if we don’t and they stay?
Take the above sentiment from a broader perspective, not just related to training but more so to creating a culture of growth, belonging, compensation and remuneration programs, talent engagement programs, training, and beyond. The moral of the story is that we need to be that CEO who knows the drawbacks of not investing in culture and talent. And today, the stakes are much higher than ever before.
As I mentioned in my last piece for Communicate, our industry is facing major challenges, opportunities, and dilemmas. We are at a crossroads. We need to pivot; we need to unlearn old rules and learn new ones; we need to adopt new game strategies; we need to invest in our people and care culture, and we need to play the long game.
[Richard Branson’s] famous quote, “If you take care of your employees, they’ll take care of your clients,” has never been truer. And, with that in mind, our entire focus should be to ensure our people become our first status item every day. Beyond the attributes of role clarity, the flexibility of new working models, hybrid working cultures, and engagement strategies, we need to focus on how we can recognize talent better, and the theory of recognition is very much centered around talent having more skin in the game.
For the people, having more skin in the game means that they are valued more; they are trusted more, and they belong to an organization that shares the risk and shares the reward.
For the company, having more skin in the game means looking at enhancing company culture and remuneration culture; it means bonus structures that are attainable and clear; it means rewarding entrepreneurship; it means creating more symmetry that provides more long-term yield and reducing the asymmetry in governance.
Many companies have realized that today’s salary-alone type of approach is a short-term strategy. The good employees – the great ones; the ones that don’t need a pep talk and are entrepreneurs by instinct; the ones that drive the company’s reputation; the ones that lead by example – need something different to be recognized.
Even though most companies may say it’s difficult to put entrepreneur-type bonus schemes/commissions on targets in place in their operation, there are ways to make these changes if there is a belief that these actions form a vital component of long-term growth. The key point here is the realization that change is needed.
If we don’t modify and get creative with the way the remuneration culture is currently structured, it will cost us topline revenue and bottom-line margin growth shortly after.
Incentivizing our talent needs creativity and can take many shapes, forms, and pairings:
• Quarterly revenue target incentives
• Percentage of revenue sharing once the company targets have been reached
• Spot bonuses on non-financial KPIs
• New business merit raises
• Departmental goals and bonuses promoting collaboration
• Compensation on meaningful referrals
And the list can go on...
All these types of incentives will reward drive, create a real culture of belonging, improve productivity, and enhance behaviors that have an impact on the company’s bottom line and standing reputation.
Incentives can also encourage teamwork and collaboration by weakening silos on top of rewarding success for a wider team. When we incentivize our performing talent, it, in turn, incentivizes others to do better. Talents need to have a clear idea of how they can outperform and get the necessary incentive. Anything less will leave them confused and, ultimately, less productive.
In a recent article published in Wired, John Goulding, CEO and Founder of employee communication platform Workvivo, stated that “Above a certain point, people want to feel part of something bigger, a company with a great culture of emotional connection, recognition, and communication, and if people are not deliberately creating that culture, they’re bound to fail.”
Laura Kerekes, Chief Knowledge Officer at HR consulting company Think HR, outlines that “Providing incentives on the fly doesn’t always have the same impact as when you have a thoughtful, well-planned program tied to certain metrics. If it’s done well, it’s a retention tool; done badly, it will destroy the culture and yield the exact opposite results.” I believe many companies are still not communicating properly when it comes to these programs.
In ending, studies in every city on our planet are showing that today’s talent wants more flexibility – flexibility of space; options of hybrid and remote work; progressive work/life balance programs; health and fitness programs; family programs and counseling guidance; paternity and maternity initiatives; and, of course, more skin in the game. These are vital initiatives that help create more pull to ensure people remain part of the tribe. These initiatives will create more peace of mind for people so they can, in turn, focus on doing their jobs to the fullest. And it’s on us to understand these factors and be genuinely devoted to the movement – because it is a movement.
Adam Grant, an organizational psychologist at Wharton and bestselling author, outlines a few points on leadership and ownership which, I believe, serve as a great true north for anyone leading:
• The first rule of leadership: put your mission before your ego
• The second rule of leadership: if you don’t care about your people, they won’t care about your mission
• The third rule of leadership: if someone must tell you about the first two rules, you are not ready to lead
We need to understand the gravitas of the matter. Our mission should be to enhance and renew the care model and recognize that playing the long game to improve real culture is the only way we can achieve growth and success for people, brands, and businesses.
This article was published in Communicate's latest issue.