Performance review season
The stresses of the financial year end often herald the stresses of performance review season. Your teams may have given their all recently but with budget constraints to consider, how do you retain talent and boost performance when salary increases and bonuses can’t be as generous as you’d like? If you’ve already had one too many conversations that have started with ‘you’ve had a really good year but we can’t give you much’ your reports may be getting as tired as you are. The idea of rewarding them now and incentivising another top twelve months may seem beyond what you’re capable of at the moment but there are other ways to keep your valued people engaged and positive and it all starts with coffee.What we can learn from coffee culture
The UK branded coffee shop market achieved 11.9% sales growth last year – this despite a serious squeeze on consumers’ pockets. Bucking the economic climate, the enduring appeal of shop-bought coffee is brewed from a balanced blend of human need and well-deserved treat. It’s an easily accessible reward when the purse doesn’t quite stretch any further. What can we learn from this?- Human emotion is not an insignificant motivator – even in small amounts.
- Incentives tailored to a budget can be highly effective as long as they’re also tailored to the individual (and by default the team and company).
- Loyalty and identity play a huge role – people still invest in a brand, even when alternatives are cheaper.
An affordable essential
When things are tight, the HR budget often takes a hit. It’s not just hiring and incentives that suffer, learning and development can feel the squeeze too. A Gartner survey found that 90% of CEOs expect inflation to rise in the next twelve months and 50% of HR leaders expect increased competition over talent over the next six months. This creates pressure in the gap as companies struggle to attract and retain the talent they need for the budget they can afford. So the challenge is to make the very best of what we already have. What does that involve? How can we leverage human delight and relevant, human incentives to encourage the loyalty, innovation and commitment we need to succeed? To meet your business goals and pull ahead of your competition, a sound people strategy backed up by highly skilled managers is not an affordable luxury. It’s an essential you need to make space for. How do the three points above show up in practice during performance review season?1. Engage with human emotion
It’s time to think outside the box. Budgetary constraints may nudge you towards a conversation you should have been having anyway: namely, what do your people want? Make nurturing safety, belonging and mattering a priority to promote adaptability, innovation and commitment. Just the attributes you need in your people at the moment. This is when the benefits of diversity are embraced, experimentation is encouraged and feedback is enriching. You don’t just want to encourage people to stay with you, you want them to thrive.- People need to be seen for who they are and how they contribute.
- Focus on possibility and potential but not in a way that makes them feel inadequate.
- Be honest and admit that you don’t have the answers. This fosters a feeling of genuine partnership.
- Recognise that everyone, at all levels, feels the effects of change and uncertainty.
2. Tailored incentives that are able to go beyond salary
This involves adopting an approach of flexibility and respect for the whole person. This will nudge you towards a conversation you should have been having anyway, namely what do your people want?- Reward and recognition should mean something, otherwise you’re wasting precious resources. How do you create a safe space for people to share their feedback?
- During the pandemic, hybrid working allowed for greater work/life balance for some. Others couldn’t wait to get back to office life. This should be about what works for everyone and accountability should flow both ways.
- Ensure that equality, diversity and inclusion aren’t lip service. Don’t make assumptions and listen in with care.
- Move away from the idea of an employee proposition towards a culture of employee experience. Introduce this with a firm sense of collaboration and commitment. It has to be human-focused or it won’t work.
3. Loyalty and identity play a huge role
This is all about context. Among Mercer’s global people strategy insights for this year is a focus on working in partnership. ‘People no longer want to work for a company, they want to work with a company… Today ‘partnering’ over ‘leading’ might be a company’s biggest competitive advantage’ it states.- Where do you sit within someone’s career journey and how do you actively enhance the time they spend with you?
- What career moves are open to them? Will they need to move on to get the experience or stretch they’re looking for or will you retain their talent and experience by creating a pathway that excites them?
- Ask yourself questions about where they sit in the wider picture and how they help to achieve the purpose of the business.
- When objective-setting for the next year, ask where they will be heading and what your role is. Do they need work experience in another department or on a different project? How flexible can you be?