COMPENSATING workers pays off in incentivising them and has a knock-on effect of impressing customers who then spend more.
That was a key message delivered by global strategist Verne Harnish when he addressed a recent Shannon Chamber webinar.
In the context of increasing competition for talent and difficulties in attracting and keeping staff, Mr Harnish said that a number of principles should be considered when setting pay scales .
“Start with wide pay bands to give people the opportunity to move up the organisation. Be careful on individual incentives as these can be fraught with a lot of problems and jealously; focus more on incentivising teams.
“Adopt a gamification approach to rewarding employees. Keep it non-monetary and keep as much fun in the system as possible. Have a good structure in place for longer-term share equity schemes and only pay this out annually,” he said.
He also stressed the need for companies to keep their customers in mind when addressing employee compensation, and the importance of understanding the link between labour costs and overall revenue generation.
“You need to ask how much you are willing to pay people. One great employee can replace three good employees. That’s why it’s important to focus on attracting the great,” he added.
Summing up the importance of the webinar, Shannon Chamber chief executive Helen Downes said that the pandemic has forced human resources’ managers to review their compensations strategies.
“The employment landscape is extremely competitive now and this is forcing companies to review their compensation packages to ensure that they are fit for purpose. They will benefit greatly from the advice given by Verne Harnish who has been helping small and medium sized companies to successfully scale up for over four decades.
“We look forward to having him back in Shannon in May for a two-day workshop when companies may have had a chance to action some of his key messages,” she added.