Business Success and Rewarding the Right People
Building a sustainable business by rewarding and keeping the right people

By: Bruce Bahlmann - Contributing Author (your feedback is important to us!)

Created: January 20, 2007

You or your company has just completed a successful and lucrative rollout of a product or completed a blockbuster sales year. Its the end of the year time or at the completion of the project and as you muddle through annual reviews or the task of handing out bonuses, you are faced with the task of taking some allocation of funds and dolling it out to your staff. In this article we review what generally happens and how small changes in this norm can yield profoundly on employee productivity and retention.

The "Norm"

Someone in the company has a great idea, the company rallies around the idea, the product materializes, sales and marketing jump on board and aggressively market and sell the product, customers adore the product, and money starts flowing in by the truck load as the company realizes new found success.

Too often than not, shortly after a blockbuster hit like this, the success of the company gets noticed by other companies who begin to look for similar profits of their own, key people in the company begin to get recruited to join competitors or start their own company, others follow, and before long the company is reduced to a one hit wonder. What is left over time is a shell of a company devoid of their best talent and reduced to a level where it can neither innovate nor rally what is left to find the next blockbuster. The fire and motivation for employees to conjure up the energy to collectively work hard again becomes increasingly difficult as employees now question why they should spend the extra effort.

Where is the source of good ideas?

One of the obvious problems with "the system" is that company's don't always look deep within upon completing a successful run - often times by the time the source is discovered they are either no longer motivated or have already left the company. Few company's find blockbuster success as a result of the CEO or CTO having a visionary moment. Rather, more likely than not, it is some customer, salesperson, product manager, or engineer discovering an improvement on something and upon socializing this among workmates does the full breath of the blockbuster idea materialize.

Why the Mass Exodus?

It is NOT in people's nature to leave good companies. People leave because they believe that things will be better at some other company (they will be treated better, better benefits, better hours, better boss, possibility of bonuses, etc.) or believe they will be better rewarded for their contribution. While these are often false assumptions, the promise of higher wages is the only thing that such people can count on. Rarely, are the reasons for leaving a company personal - death in the family, dedicate more time to family, retirement, etc. Which leaves the main reason that people leave is that they don't feel they are recognized or valued.

The Reward - How it is given is just as important as the amount!

Upon a successful run, clearly companies need to compensate sales and marketing and executives to keep the run going, but they also need to look DEEP within the company for the source of the run. This should not be an annual event, nor does it need to be hyped up as a big deal - actually the quieter this is handled the better. Upon finding the key team, call them up individually for a meeting with the CEO and CTO where the acknowledgement of their contribution is made privately. This kind of private acknowledgement with each key member of the team accomplishes two things: 1) it conveys value to these employees that they might not get otherwise from their salary, 2) it provides huge motivation for them to find the next blockbuster idea - because they'll want to get called up again. Here are some things you can do to further capitalize on these reward events:

• Make the moment all about the employee - they should walk away feeling GREAT about themselves, about the company, and about what they accomplished!
• Reward amount of $5,000 should be a minimum amount given (smaller amounts are too insignificant considering the nights and weekends such employees likely spent to make the project successful) but take special care such that the check amount is for a full $5,000 (in other words, don't award 5k yet after taxes its much less). The small expense required to cover taxes will add strength to your discussion when you tell them you are giving them $5,000 check.
• Ask employee to keep this event confidential and tell them that not everyone in the company is getting rewarded.

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