Employees want feedback. Delivered in the right manner, at the right time, continuous feedback helps employees understand their contribution to their employers – and plays a major role in employee morale. Employees thrive when they are regularly mentored, directed, and advised – with regard to both mistakes and achievements. Additionally, when that annual review comes around, the continuous feedback given throughout the year eliminates anxieties and pressures about the evaluation, allowing employees to focus on and discuss the work, professional goals, and overall compensation away from their daily activities.
By creating an effective, continuous performance management process – that includes desirable, overall compensation packages – firms can enable employee success and job satisfaction. Because pay is not the only incentive that motivates employees to succeed or to stay with an organization, you must differentiate yourself by offering an appealing overall compensation package.
Here are two ways to manage employee performance:
1. Focus on Creating a Consistent and Fair Compensation Philosophy
Creating a simple, yet effective, compensation philosophy that is consistently applied to all positions provides the fairness that employees seek from their employer. A compensation philosophy is a statement outlining your company’s position on employee compensation. Supplying your staff with a formal philosophy provides both transparency and an explanation of your pay strategy. Additionally, the compensation philosophy creates a framework for consistency, which makes your company more attractive to current and prospective employees.
Your HR team will work with you to create your compensation philosophy, which is based on the following company details:
- financial position,
- ability to find quality talent, and
- salary survey information.
Once established, you will need to review the philosophy periodically to ensure it’s still working, applicable, and consistently followed. Fundamentally, the philosophy provides your staff with a clear performance path to achieve their desired compensation.
2. Focus on Overall Compensation Versus Pay
Often, compensation is directly focused on pay, but when an organization communicates in terms of overall compensation, it provides employees with indirect benefits and rewards that make the company more attractive. By combining fair pay with attractive incentives, your company can secure good employees who are motivated to do well, positively impacting employee performance. Examples of indirect benefits include:
- extended health benefits,
- an Employee and Family Assistance Program,
- an RRSP matching program,
- professional development courses and mentorship,
- tuition reimbursement,
- disability income protection,
- sick leave,
- bonuses, and
- flexible and alternative work arrangements.
How you define your company’s total compensation program differentiates you. By offering attractive overall compensation packages, organizations recruit and retain qualified employees, and improve productivity. As for your employees, this program will provide assurance that their income is secure and that their families are supported, despite what life throws at them. While additional benefits have corresponding costs, your company can reap higher value in return. Try to be creative in providing quality incentives to your staff; benefits could be as simple as allowing your employees access to extended health benefits immediately, giving them birthdays off with pay, mentorship opportunities, or allowing staff to telecommute.
Managing employee performance in your organization may seem like a difficult task. When you focus on both creating a consistent compensation philosophy and overall compensation package, you provide your employees with an understanding of their value and what that contribution means.