How Rooted Is Your Workforce? Towers Watson Global Workforce Study

Towers Watson recently released an executive summary of their 2010 Global Workforce Study, noting primarily the impact of the recession on employees. Key findings include:

“Our study reveals a recession-battered workforce — one with lower expectations, increased anxiety and new priorities. … The desire for security and stability trumps everything else right now, in part because employees see security as a fast-disappearing part of the deal. Confidence in leaders and managers is disturbingly low — particularly in terms of the interpersonal aspects of their respective roles.

“In short, “business as usual” on the people front is not an option because there is no business as usual any more. (emphasis original) … Employers need to adopt new and creative practices to balance effective cost and risk management with enhanced employee retention and engagement. Employees will likely view careers, skill building and mobility very differently from how they did in the past.”

While I agree that confidence is low and that there is no such thing as business as usual any more, I believe the current low mobility of employees will change, and it will do so relatively soon. Employees have seen the lack of commitment the company has towards them. Just as this has escalated in the last 30 years, it will only continue to do so as employees use an improving economy to exercise their ability to find new, better, more exciting work.

Trust in management is lost. Some see this as a permanent break in the employee/employer workplace relationship. Dan Pink coined the term Free-Agent Nation more than a decade ago referring to this phenomenon.

While mobility is currently at a low point, this will change. The primary benefit of a free-agent nation to the employer is the constant stream of new, fresh ideas. But the costs are potentially much higher from the investment to find, hire and train them, the loss of accumulated knowledge in longer term employees, and the loss of people to serve as mentors to new employees on the company culture as well as the job function.

What do you think? Are employees so in need of job security they will stay put and hope for a return of “jobs for life?” Or do you think this is a temporary state of mind, soon to change as opportunity improves? What are you doing to prepare now for the outcome?

Making Recognition More Relevant than Cinco de Mayo in Mexico

I’ve been traveling around the U.S. for the last two weeks, visiting our Boston offices and several customers as well as participating in the IHRIM 2010 conference. I greatly enjoy the opportunity to travel in the US and experience the many different global cultures that make up this one country. I’ve noticed, however, that American traditions that celebrate these various cultures have taken on a rather unique American flavor. I’ve experienced St. Patrick’s Day in Dublin and in Boston. Let’s just say that green beer does not flow freely in Dublin pubs.

I was struck by all the promotion around Cinco de Mayo. After a little investigation, I learned Cinco de Mayo (the Fifth of May) was originally a small, very local celebration in one Mexican state, celebrating victory over the French in a battle in the mid-1800s. It has nothing to do with Mexican independence (as was assumed by many Americans I chatted with on the topic) and is not an observed holiday in Mexico. Cinco de Mayo has become "Americanized." My American friends and colleagues are celebrating a Mexican holiday that is not relevant to Mexicans.

What lessons about employee recognition can we learn from this? Think about your current recognition program(s). Is it largely based on the needs and desires of employees in the country where you are headquartered? Have you “Americanized” recognition to make it one-size-fits-all, or are you truly honoring your employees and their accomplishments within the context of their own culture, traditions and expectations?

It seems to me that Cinco de Mayo has become more a reason to celebrate Mexican heritage in America, just as St. Patrick’s Day is a reason to celebrate the Irish in everyone. So should recognition be a reason to celebrate the achievements that are common to your company culture as a whole – demonstration of your company values in contribution to your strategic objectives.

Too often, well-intentioned company or HR leaders offer a recognition or incentives program that forces people to choose a reward from a catalog of items they’ve pre-selected. We see this all the time. Even though it’s well meaning, this approach can come off as insulting and is uninspiring for international employees.

Why fight against this approach? Local department stores, local restaurants, local cinema chains, local entertainment venues, local travel companies - they know best what your local employees want. That's why we've invested the past 10 years in building the world's largest selection of rewards entirely on the shoulders of these locally based merchants – so your employees will always have a culturally correct and personally meaningful reward that inspires them. Show your employees you truly value them, their contributions – and their uniqueness.

What’s Critical to Retention? Clear Communication and Trust

In December 2009, The Economist Intelligence Unit surveyed 410 senior executives from across industrial sectors and countries on the talent management challenges they face as they recover from the recession, issuing the results in their Companies at a Crossroads report.

Among the key findings were the realization that business confidence is returning, resulting in increased hiring, talent issues are high on the agenda, and employee trust becoming an issue. Nearly 90% of respondents expected a slight to significant improvement in overall growth prospects for their company in the next three years, signaling a need to hire, train and develop talent.

The majority (57%) agreed that clear communication of the organization’s strategy was the most important action to take to rebuild employee trust. This response was well balanced between respondents aged 18-39 and those 40-69. However, a significant disconnect between those two groups on the current level of trust could potentially skew the message and success of any such communications.

In response to the question: “How would you describe your employees’ attitudes to their jobs right now?” only 21% of chief executives, presidents and managing directors replied, “Levels of trust are very low: I am concerned a lot of people will resign in the next 12 months” as compared to 55% of managers.

Since managers are arguably closer to the pulse of the average employee, I would encourage senior executives to listen to the need to repair the trust relationship. As Doug Conant, president and CEO of Campbell Soup said, without trust from your employees you cannot achieve amazing things. And “amazing things” are precisely what companies will need from every employee to thrive in the recovery.

Should Motivation Strategies Be Different for Top Performers vs. the Average?

As we continue to emerge from the recession, companies will be struggling with retention and loyalty. The Chartered Management Institute (CMI) recently reported that “more managers resigned from their jobs in the past year than in the previous 12 months” – and that was in the midst of the recession. Think how much more these resignations will grow in the recovery.

Hay Group focused on the importance of recruitment and retention of key talent in their recently issued report: “The Changing Face of Reward.”

“The focus is on motivating, engaging, and rewarding critical high performers. … Reward strategy is now driven in the Boardroom as executives recognise that the war for talent knows no boundaries, so strategies for retention, motivation, engagement and performance improvement are integral to competitiveness."

There is a risk in putting too much attention on the high performers and not as much on the vast majority of middle-tier performers.

”The war for talent has narrowed to three fronts, the study finds: around high performers; high potentials; and ‘mission-critical’ roles. … There is a danger that ‘average’ performers – who make up the bulk of the population – can find themselves ignored in the rush to reward top talent, and weed out poorer performers. But for most companies, shifting performance in this middle category is what will really make a difference to surviving the present recession and performing in the upturn. Organizations should not take their eye off the ball on efforts to keep this critical set of staff motivated, engaged and adequately rewarded for the positive contribution they make.”

Watson Wyatt (now Towers Watson) pointed this out in their 2008/2009 WorkUSA report, encouraging investment in the core, noting that working to increase the productivity of this middle 60% can help improve the productivity of the high performers as well. And Jack Welch, long misunderstood in his approach to differentiation, actually said, “Everyone in the middle 70% needs to be motivated and made to feel as if they truly belong. You do not want to lose the vast majority of your middle 70 – you want to improve them.”

What are your retention, motivation and engagement strategies for your high performers? Do they differ from similar strategies for your middle tier? How so? Is this difference even necessary?