Incentivising employees is never a cost
Bonuses and incentives for employees in recognition of their contribution work as investments for a company’s sustainable growth. It ultimately drives innovation and productivity
Focusing on people's experience within a company can indeed yield significant financial growth. I've witnessed companies prioritise their human capital and thrive despite limited financial resources. Offering substantial incentives to employees in recognition of their hard work translates into a higher return on investment (ROI) for the company, fueling its prosperity.
Investing in people is a strategy that consistently pays off, as evidenced by instances where companies, during tough financial times, increased their investment in employees and subsequently experienced a complete turnaround, achieving double-digit growth the following year.
My involvement in spearheading change in management during a significant merger solidified this conviction even further. Throughout the merger process, despite its success, the company fell short of meeting its financial targets. Consequently, employees missed out on their annual performance incentives, despite their individual achievements because the company failed to meet its deliverables.
Naturally, employee motivation plummeted, and management acknowledged the gravity of the situation.
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I vividly recall the proactive approach taken by the management, particularly the CEO who had recently assumed leadership, to address this issue. They advocated for a special incentive scheme, designed to reward employees based on their performance in that running year (the year after the merger). The management's objective was clear: to boost employee morale and recognise the invaluable contribution of the workforce, the company's most critical asset.
Despite encountering resistance from shareholders and the board of directors, the management embraced the challenge, viewing it as an investment rather than a cost. They firmly believed that rewarding employees yields high returns on investment, notwithstanding the hurdles they faced in justifying the expenditure to stakeholders.
There were a myriad of complexities involved but the company emerged triumphant by placing paramount importance on the employee experience and cultivating a vibrant work atmosphere. This approach not only facilitated seamless navigation through the merger but also propelled significant growth in customer acquisition and financial performance in the subsequent year.
Remarkably, employee engagement scores soared after such a monumental management shift alongside the successful integration of two distinct companies post-merger. Furthermore, both general employee attrition and talent attrition witnessed marked improvements.
The crowning achievement came in the form of the 'Best People Management' award bestowed upon the company by their group. This accolade stands as a testament to the unwavering commitment of both management and employees alike. Their shared belief in investing in people yielded tangible success, solidifying the company's position as a beacon of effective leadership and organisational excellence.
Top management's active engagement with employees, especially during crises, is paramount for maintaining motivation and ensuring high levels of productivity which directly correlates with financial performance. I have been part of companies where even amidst financial challenges, management didn't hesitate to allocate additional resources towards employee development and well-being. This commitment to people-centric policies resulted in remarkable turnarounds and sustained growth.
Therefore, viewing bonuses and incentives as investments rather than expenses is crucial for a company's sustainable growth. By nurturing and empowering its workforce, a company not only enhances employee satisfaction and loyalty but also drives innovation, productivity and ultimately, financial success.
From an employee's perspective, it's also crucial to acknowledge the reciprocity relationship with management. Recognising the significance of the company prioritising employee's well-being and professional development is essential. Employees should appreciate management's effort to invest in their growth and foster a positive work environment, particularly during challenging periods.
Amid a crisis, it's paramount to remain engaged and motivated. People's commitment and perseverance directly impact the company's trajectory. Embracing opportunities for personal and professional advancement underscores an employee's value within the organisation, knowing that their contributions are esteemed and duly recognised.
Bonuses and incentives shouldn't solely be viewed as financial rewards but as a tangible acknowledgement of our dedication and hard work. It's crucial to grasp that management's investment in us extends beyond immediate gains, aiming at constructing a sustainable and prosperous future for both the company and its employees alike.
By nurturing a culture rooted in mutual respect, collaboration and a commitment to ongoing enhancement, both management and employees can collectively propel the company towards enduring prosperity and growth.
In conclusion, maximising organisational growth through HR asset sweating [the better utilisation of structures that are already in place] is imperative in today's dynamic business environment. By recognising the invaluable contribution of human resources and adopting strategies to optimise their potential, organisations can propel themselves towards enduring prosperity and growth. From management's active engagement to employees' acknowledgement of their reciprocal relationship, HR asset sweating emerges as a cornerstone of sustainable success and competitive advantage in the modern business landscape.
Faisal Imtiaz is a Business Faculty Member at the Centennial College, Ontario, Canada.
Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the opinions and views of The Business Standard.
