Why incentives are essential in the modern labor market
Today’s workplace culture isn’t what it was 20 years ago. Hierarchies and strict work schedules have been replaced by horizontality and flexibility. Before, we worked in offices with bosses; today we can work from anywhere with leaders. Fixed technology, confidentiality, and corporate ladders have given way to the cloud, shared information, and growth opportunities.
As a result, modern expectations for employment are high. Companies know that if they want to hire and retain top talent, they need an office culture that helps employees feel satisfied and valued.
Consequently, perks have become a key part of a modern and positive workplace. However, many companies still don’t grasp that they need to back this up with a congruent work culture. After all, what’s the point of a team-building event if the manager only knows how to lead by ordering and criticizing?
To learn more about this, we spoke with Sonia de Mier, Director of Communication and Marketing at Great Place to Work Spain.
Q: What are the most effective perks a company can offer its employees? Which benefits create the most loyalty?
Sonia de Mier: At Great Place to Work we’ve spent 30 years studying working environments at various companies. During that time, we’ve shown that the most effective perks, from a commitment and loyalty standpoint, are based on a culture of trust.
The most committed employees feel proud of their work, and trust and enjoy being around their peers. Hence, the most valued incentives and benefits are those that help them to feel fulfilled professionally and personally. Commitment is best fomented with people who feel respected, listened to, and recognized, in a trusting environment where they can be themselves and give their best.
Our experience shows that employee commitment is directly linked to trusting relationships with superiors. Leaders that delegate, inspire confidence, are competent, open, and honest are fundamental for employee satisfaction and loyalty.
These are leaders who, rather than directly supervise tasks, trust their staff and incentivize them when needed. That recognition, along with a healthy work-life balance and professional development, are key to making employees feel proud of their work and their employer.
What perks can small and medium sized businesses offer?
SdM: Regarding the best practices of Spanish SMEs recognized by Great Place to Work, we highlight those tied to communicating company culture, history, and values. To that end, more SMEs are encouraging face time with management. This could be “breakfast with the CEO” or quarterly meetings to help to create an emotional connection and promote loyalty. Or maybe weekly strategy meetings, or 3-5 minutes each day with a rundown of the goings-on at the company. Communication and transparency are the keys to a great workplace.
The best SMEs also have plans for flexible hours, remote work, etc. They advocate best practices for professional training and development (workshops, seminars, language training, etc.), as well as channels for effective vertical and horizontal communication (intranet, blogs, company news bulletin, suggestion boxes, etc.). Being open to the ideas and suggestions of your colleagues is a sign that their work matters. It’s a question of understanding that your employees have something valuable to say. In that sense, the best SMEs establish a warm and tight-knit environment that encourages two-way communication.
Other practices center on team building activities and tech innovation through the development of web apps. More SMEs are using virtual communities, where employees are integrated starting their first day at the company.
Finally, for personal development, some SMEs hold wellness sessions, in which employees work on their emotions, relaxation, meditation, etc.
Just how important are perks? How much weight do they carry in the Great Place to Work evaluation?
SdM: When people have a positive professional experience, their opinion is valued and they’re treated with fairness and respect, they will give their best. This ultimately has positive repercussions for a company’s bottom line.
Great Place to Work uses the same methodology in all 58 countries where it operates, and applies the same model to certify the Best SMEs.
The first phase consists of diagnostics done with two tools: an employee survey called Trust Index, and an analysis of company culture via its policies and HR practices called Culture Audit.
Trust is a central part of the employee survey, which also measures employee perceptions across five dimensions: Credibility, Respect, Impartiality, Pride, and Camaraderie. The second tool is shared with the HR department, which describes the company’s practices and internal processes. These tools compare and contrast company policies with employees’ perceptions of said policies and their implementation.
Furthermore, Great Place to Work and the chosen “Best Companies” collaborate to create action plans for upper management, middle management, and employees, with the goal of improving results for the next year.
Finally, our consulting team helps companies improve their talent management practices, while ensuring that changes also positively impact business results. We take into account not only the information drawn from our own audits, but also any relevant company information. This allows us to design plans based on clear metrics and objectives, both for culture and HR, and for a business’ bottom line.
Today, companies are pushing for greater innovation and continuously transforming culture, to help them stand out in a competitive market. This is what we call High Trust – High Performance Cultures.
What are the main trends affecting the design of incentives?
SdM: As described in our book “A Great Place to Work for All”, there is an emerging focus on developing human potential. That is, to create a positive experience for all employees, regardless of their role in the company. The latest trends in labor incentives advance education and awareness in equality, diversity, and inclusion in the workplace.
Today, the labor force is made up of multiple generations that each view and experience the world differently. Therefore, in the face of increasing diversity, SMEs should take into account generational and cultural differences. It’s important to understand what each group values and how it works, in order to meet new demands. 2017 was the first year that generation Z had a notable presence in the labor market, and their expectations forced certain changes.
In summary, the top SMEs analyzed by Great Place to Work anywhere around the world are building high trust cultures. They’re ensuring that all employees live their values, and improving their work experience, which in turn positively impacts business.
Companies that create open, innovative, collaborative, and high trust cultures will gain a competitive advantage. They are better prepared to anticipate and adapt to new working styles, thereby becoming High Trust – High Performance organizations.
We’d like to thank Sonia de Mier for sharing her time and views about perks and employee incentives.
Feel free to share this with anyone who wants to know how to get listed as a Great Place To Work!