Morale building bolsters bottom line
When it comes to employee incentive programs firms still focus more on sales goals
By David Todd (edited)
January 17, 2000 - Strategy Magazine
Special Report: Premiums & Incentives

At the risk of being blunt, who really cares if employees enjoy their work or not? I mean, come on - you're not paying them to be happy. They can do that on their own time. You're paying them to show up (smartly-dressed and on time, thank you very much) and bust their backsides to get the job done. If they happen to derive fulfilment from what they do...well, that's great.

If you consider the attitude above just a little retrograde, you might want to read on.

While no one's suggesting that corporate North America has suddenly gone all warm and fuzzy, there has been a growing recognition that employee morale matters a great deal indeed - that it has a direct impact on job performance and, in turn, on the bottom line. And one consequence of this has been the slow but undeniable growth in the prevalence of employee incentive or reward and recognition programs geared specifically toward improving attitudes and building team spirit (as opposed to the more traditional programs aimed simply at spiking sales results).

"With re-engineering, downsizing, rightsizing and mergers, morale in companies is not what it used to be," says Rob Stonehewer, president of Burlington-based Rob Stonehewer & Associates. "People's jobs are perpetually changing, and everybody feels nervous. So companies will implement these programs to instil some of the confidence that's been eroded."

An effective morale-building program demands a substantial long-term time commitment, which can be daunting to many executives. Not surprisingly, given the time and resources required, larger companies are the ones most likely to commit themselves to initiatives like these - and then only when they feel they can afford it. Assuming that a company does wish to take on the challenge - what then?

Stonehewer, for one, says a crucial first step is to conduct some form of employee feedback survey. That affords some measure of current attitudes, and helps the organization set strategic direction for the program...

Suggestion programs tend to be a popular choice, Stonehewer says, because they promote a sense of employee involvement and empowerment, and at the same time offer management a degree of measurability. Rewarding employees for contributing their recommendations on, say, cost reduction is an obvious morale builder. And, by tracking the results once these ideas are implemented, a company can quantify the impact on its bottom line.

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