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Employee Contentment— Flexible Benefits

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"The ladder to success is not an escalator."

A Gallup Poll overwhelmingly pointed to good health insurance as the most important "characteristic" of any job. Although it ranks first on a list of what respondents felt were important (81 percent of them chose medical benefits), only 27 percent said they were completely satisfied with their current health insurance. This represents a sizable discrepancy between what workers say they want and what they feel they're receiving.

Times have certainly changed, if this Gallup poll is a barometer. It was only a few years earlier that high income would have been at the top of the list, or close to the top of any list of employee motivational factors. That's not to say that a fair and equitable wage doesn't continue to be a critically important ingredient in employee contentment. What seems to happen is that once a decent pay line is established, other factors are allowed to loom more important.



This has been confirmed by studies of Robert Half International. Respondents to our questions revealed that people aren't leaving their jobs as quickly to chase after bigger money. Instead, they're leaving for such non-monetary factors such as career advancement and increased responsibility and opportunity.

Employers who fail to heed the inherent message in these studies that money alone won't necessarily keep their best people are destined to lose some of them.

Offer Flexible Benefits

That health benefits rank first with employees should come as no surprise. Health care has become the dominant topic on the minds of political, economic, and business leadership. As previously pointed out, many men and women hold on to their jobs primarily to retain their company-sponsored health insurance. At the same time, employers are faced with a spiraling increase in the cost of providing these benefits to their workers and are actively seeking new approaches.

Flexible benefits programs are springing up in many American companies. In most cases, it is cost containment, rather than attempting to meet diverse employee needs that fuel this search for new ways to provide employee benefits.

Flexible benefits plans are defined as those offering employees a choice among varying types and levels of benefits. They're sometimes called "cafeteria benefits" because of the varied menu they offer. For example, employees can select a lower level of health care benefits in return for additional vacation days, or pare their life insurance benefits and opt for more extended medical coverage.

Frank DiBemardino, a Foster Higgins principal and one of the study's authors, explained, "Clearly, Flex employers are making cost management a top priority in the wake of a nearly 40 percent increase in health benefit costs."

George Faulkner, a Foster Higgins consultant and co-author of the study, commented, "The lower average cost among flex employers relates partly to the use of managed care provisions. HMOs, for ex-ample, typically adopt more competitive pricing when offered through a flexible plan."

Foster Higgins found that employers with between 2,500 and 20,000 employees have the administrative resources, budget, and staff to implement a new plan and are the most likely to offer flexible benefits.

Among industry groups, flex plans are most common with companies engaged in financial services, insurance, energy/petroleum, and education. Flex plans are less prevalent among communications, consumer product, wholesale/retail, and utility organizations, which tend to be highly unionized and which employ large numbers of part-time workers.

Develop a "Parent Track" for Advancement

An interesting phenomenon is that during the prolonged recession when people should have been preoccupied with holding on to their jobs, many were seeking to work less. It wasn't laziness or a lack of ambition. Rather, it was a desire to rearrange their working lives in order to have more time with family and to pursue nonvocational interests.

This movement launched the concept of parent tracking, snidely called "mommy tracking" by some because it was wrongly perceived to apply almost exclusively to women with children. Parent tracking is a more accurate term; the idea applies to both genders.

That workers wanted more time to spend with family prompted employers to create additional approaches to accommodate this need- flex-time, job sharing, and on-site child care among them. These, and other ideas, have been adopted in one form or another by companies across America.

Simply defined, parent tracking is a management concept that allows professional, career-oriented parents to achieve promotions within their companies, but be allowed to do so on a slower "track."

A number of large accounting firms have astutely instituted parent tracking programs in response to employee requests. Because Robert Half International deals extensively with these organizations, as well as with men and women seeking to be employed by them, I've had the chance to observe the trend closely. There's no question about it: an increasing number of candidates for employment are seeking such arrangements, and they are being accommodated in increasing numbers.

Another indicator of employees wanting to work less is the large increase in the number of men and women working in temporary capacities, rather than accepting full-time, permanent jobs. They're able to work, or to devote blocks of time to family needs.

The accounting profession is a good bellwether for parent tracking because of its traditional system of establishing paths, or tracks, to partnership status within firms. An employee who chooses parent tracking is not precluded from achieving that coveted partner plateau, but understands that it will take longer to get there, perhaps 13 or 14 years instead of nine or ten. It's a trade-off in the classic sense, one that each individual must decide to accept or decline.

From the employers' perspective, offering such flexibility requires considerable restructuring, which costs time and money. They don't do it out of altruism, but elect to offer flexible career paths and working hours because it makes good business sense. Rather than lose valuable and productive employees, they retain them while still allowing them to pursue dual goals of career success and family responsibility.

Parent tracking is more than a concept at Deloitte Touche. It's a reality. Although only female employees have chosen to participate in it thus far, it's also available to their male counterparts.

Arthur Andersen & Co. has initiated its own form of parent tracking. All men and women at the manager level are eligible. Those choosing this slower partnership track spend up to three years in the program. They work part-time and are compensated accordingly, but are included in the normal performance review process.

Because offering flexibility in its various forms to workers has become relatively commonplace in American business, Robert Half International set out to survey workers and employers to determine their reaction to it, and the extent to which they are participating. Here are the results:
  • Nearly eight out of ten men and women surveyed reported that they would sacrifice rapid career development in order to spend more time with their families. Specifically, when presented with a choice of two career paths--one with flexible full-time work hours and more family time but slower career advancement, the other with inflexible work hours but faster career advancement--78 percent chose the slower, family-oriented track.

  • Two out of three said they would be willing to reduce their work hours and salaries by an average of 13 percent in order to gain family and personal time.

  • A majority believe that employees who choose more flexible hours and slower career advancement ultimately will be as successful as those opting for the alternative.

  • Only a third of the respondents said they would be likely to accept a promotion if it required them to spend less time with their families.
It's important to keep in mind that these surveys asked hypothetical questions. Many who embraced the concept of less work and more family time might not act on those feelings if confronted with making an actual choice in their careers.

Even with this caveat, it's clear that American business must deal with, at least, the possibility of having to restructure working conditions to meet a demand from quality employees for flexible hours.

Offer Personalized Perks--"Little extras" that Mean a Lot

The larger the employer, the more difficult it is to personalize employee benefits, but for any company seeking to motivate and retain good people, it pays to "think small" sometimes, to get to know each employee's "hot buttons" and, if possible, to offer perks that activate them.

An acquaintance of mine has two secretaries. Both are hardworking and loyal to this executive. He told me that one has a passion for seafood; the other shares her husband's love of hometown football. He doesn't have to give them sizable bonuses to keep them happy. Instead, an occasional gift certificate at the city's best seafood restaurant and tickets to a few games means more to each, respectively, than cash.

There are hundreds of small extras that cost little but can have a big impact on employee morale and productivity. In smaller companies, they can be given to individuals who are known to have a specific hot button, but in larger companies they are bunched into packages from which deserving employees can choose, based on a predetermined dollar value. Such packages can include:
  • The option to upgrade to first-class air travel once or twice a year for those who travel a lot
  • Being able to bring a spouse on a business trip
  • Extra days off
  • Gift certificates from local restaurants and stores with which the company has a tie-up
  • Extra discounts on the company's products or services
  • Commute-oriented packages
  • Membership at a local health club
  • Overnight vacation at a local inn
  • Continuing education subsidy at a local college
These ideas just scratch the surface of a menu-driven system of perks. In most cases where a company wishes to provide special considerations for employees, these extras are not subject to employee choice. They're simply provided. Here are some examples:

Facilitate Commuting: A medium-sized New York publisher moved her offices from midtown Manhattan to a New Jersey suburb years ago. She was afraid she would lose a loyal corps of workers who were used to Manhattan's good restaurants, to say nothing of the convenience of walking to work. She solved it by leasing a bus to bring them to and from work each day and by establishing in the new facility a state-of-the-art kitchen where gourmet lunches were served at no charge. She didn't lose a single employee. (I'm sure there were other reasons, too, besides transportation and lunch, but those offerings certainly helped to retain these employees.)

Install an On-site Kitchen: Small improvements can always be a motivator. A municipal bond firm polls its employees and finds that most of them bring their lunch from home. What they need is a kitchen in which to heat and refrigerate the contents of their brown bags.

Hire Temporary Help When Needed: Managers at another company learn through the powerful employee grapevine that the major complaint is the reluctance of management to hire extra help during crunch times. When temporary workers are brought in, the employees feel less pressured and morale rises.

Other Ideas for Perks that Motivate

Take the time and effort to identify employee hot buttons. In most cases it costs little to satisfy employee needs, certainly a lot less than losing good people.

Although each person has specific items that are meaningful, virtually everyone responds to
  • Personal notes congratulating achievements
  • A few more desirable assignments
  • Public recognition
  • Titles
  • Greeting cards and gifts for special personal occasions
  • Something free such as coffee, donuts, or fruit
  • A cheery, friendly work environment
Establish Strong Leadership and Management to Motivate

All things considered, one of the biggest employee motivators is the quality and actions of management. Free coffee and a microwave oven will never replace a management team that knows what it is doing and advances a company's goals and, by extension, the goals of its employees. Such management recognizes that enlightened leadership and employee motivation is at the crux of any company's ultimate success.

Robert Half International surveyed hundreds of executives a few years ago as to their definition of what corporate "leadership" was really all about. Fifty-three percent felt that the most important responsibility for those at the top was to motivate employees. Everyone needs and respects leadership. A company's goals necessarily must represent its employees' goals: prosperity, jobs, security, and respect.

Because the fortunes of both workers and corporate America become more inextricably intertwined as the global business climate grows increasingly complex and competitive, the partnership I speak of between employee and employer must be enhanced-and I have little doubt it will be. The "intrapreneurism of America" in which employees are less concerned about what management can do for them and more concerned with the level of respect and authority management is willing to grant them, represents the new horizon of how business will be conducted in the years ahead.

Not everyone agrees with this assessment. There's another school of thought that preaches that workers inherently want to do their best and don't need "artificial" methods to achieve it. Instead of creating awards and bonuses to inspire workers to do their jobs, advocates of this other approach urge that management get rid of the obstacles that demotivate employees.

This approach has come to be known as "process management," based on the ideas of consultant W.E. Deming. Deming feels strongly that management should make a concerted effort to eradicate
  • Thoughtless decisions
  • Lack of teamwork
  • Poor communication between managers and employees
  • Invisible and inaccessible leadership
  • Inconsistent instructions
Still, according to this article, most managers ignore Deming's advice and hold on to the following erroneous notions about employee motivation:
  • That positive motivational techniques always lead to greater performance and productivity
  • That financial rewards are a foolproof motivator
  • That some employees don't need motivation
  • That fear is the best way to motivate most workers
  • That a happy worker is always a productive worker
  • That workers today are less motivated than they were in the past
Whether employee motivation and empowerment is a matter of removing obstacles or injecting positive programs of new incentives-- more likely it's a reasoned combination of both--the salient fact shouts loud and clear. Employees cannot and must not be taken for granted. Every company's future fortunes depend on its workers. A trite statement perhaps, but one that unfortunately seems to elude too many executives whose companies, and own careers, might well rest on their eventual acceptance of it.
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