July '18

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166 • RV PRO • July 2018 rv-pro.com B U S I N E S S "You need to be careful that the per- formance objectives you set are in align- ment with your business values," Cutting warns. She points to the recent experi- ence at Wells Fargo, a bank that rewarded its employees for burdening customers with unwanted accounts as a textbook illustration of a performance-based pay scheme gone bad. "You have to make sure the objectives you set are not just based on sales or revenue, but also on the way customers and colleagues are treated," Cutting says. The salesperson who is making a great number of sales may also have a rushed, impatient manner that irritates customers. So, employers should gear their bonus plan to reward employees for quality service, according to Cut- ting, who suggest using the telephone, a mailed survey, or the Internet to assess customer satisfaction. On the other side of that coin, performance-based pay won't work if employees are unclear about how their actions directly contribute to the orga- nization's bottom line, or lack sufficient know-how to perform to their maximum potential, says Cutting. "You need to make sure employees have a sufficient measure of control over meeting the described objectives," she says. "And they must be given the proper tools to do so." Include Everyone One more hazard for performance-based pay: Employees left out of the program may resent their inability to earn bonus compen- sation. That's why it's important to include everyone – even those for whom it's difficult to measure quantifiable workplace results, according to Dye. "For people who are solely responsible for their work, and where their activities can be readily quantified, pay for perfor- mance plans are more straightforward," he says. That's why many organizations begin by measuring easily measurable achievements, such as higher revenues by salespeople, accident reductions by security personnel, and glowing cus- tomer reports for service representatives. Designing an effective program is more difficult for some members of the support staff who do not perform in quantifiable ways. However, it is not impossible, according to Cutting. "You can make pay for performance work for receptionists, housekeepers, or any kind of support staff, as long as they are given the necessary tools by manage- ment," she says. The biggest challenge is finding a way to measure support staff performance that is fair and reasonable. One approach is to ask, "what is this person's job and how well are they doing it?" Perhaps a receptionist answers the phone before three rings or greets customers in a cheerful and profes- sional way. Asking employees how they measure their own performance may offer good ideas that can be translated into a quantifiable system. Dye, with Let's Grow Leaders, sug- gests assuring success by continually expanding a plan's scope, including more people and developing more refined per- formance assessment parameters while soliciting feedback from participants. Healthy Environment Vital as it is, performance pay is not the only tool for retaining top employees. Employers also need to cultivate a respectful and supportive work environment. "It's important that people under- stand what the business wants, and that they feel valued when they meet the employer's expectations," Cutting says. "The ability to contribute and to feel involved with the success of the orga- nization can be its own motivation." Here are some additional factors that keep a company's best people aboard: • Autonomy. "High performers do not like to be micro-managed," says Christina Eanes, a work- force management consultant in Alexandria, Va. "They want the freedom to do their job in a cre- ative way, along with the requi- site responsibility and authority." That serves the organization well. "Innovation happens when smart people find new and better ways to get their jobs done," she says. • Frequent feedback. Top per- formers want to know where they stand, and want feedback more than once a year. A negative December surprise – especially if it affects bonus pay – may well send them packing, Eanes warns. The HBR report highlights the importance of monthly perfor- mance reviews. • Advancement pathways. Top per- formers expect the employer to help them advance in their fields. "You need to create a culture where people want to work with you because of what they are going to learn and have a real clear-cut career ladder so they see how they can move up," Cutting says. Sometimes clearing a path for advance- ment is easier said than done. In a per- fect world, a business would have enough open management positions to accom- modate every deserving person. Reality is often much different. What can employers do? "You need to create a growth path for top-performing people that keeps them feeling challenged even though they are not advanced into management posi- tions," says Dye, with Let's Grow Leaders. One solution is to feed the craving of top performers for new skills. "High achievers have an insatiable need for self-development," Eanes says. "They have an ingrained need to develop themselves, so the more opportunities you can provide them to learn, the more loyal they will be." Those opportunities can be offered by thinking laterally, according to Eanes. "Not every top performer expects that advancement means a higher-level posi- tion," she says. "Millennials, especially, often prefer to move laterally because it provides them with more learning oppor- tunities and more challenges." A high-performing individual in sales, for example, might welcome a move to an adjacent position in human resources with the chance to learn a new set of marketable skills, she adds.

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