Dr Bev Smallwood

Articles Library: Leadership

How To Use Value Concepts To Improve Employee Moral, Productivity, and Loyalty

The most sophisticated efforts to assess customer perceptions and to positively impact customer value can be sabotaged if the needs of “internal customers” (managers and employees) are not addressed. After all, it is they who will make or break any strategy or system designed to create good will and loyalty among external customers.

The High Cost of Low Employee Value

The fact is, your organization’s employees will, intentionally or unintentionally, convey to customers their own attitudes. In other words, they will tend to treat others as they feel they are being treated by the organization.

The direct negative interpersonal impact on customers is only one of the costs to the organization when employees do not perceive high value in their relationships with their employer. Dissatisfied employees easily develop complaining, victim-like attitudes that are contagious within the ranks. Diminished morale leads to carelessness, decreased productivity, interpersonal conflicts, lack of loyalty, and ultimately, high turnover.

The personal, social, and economic impacts of each of these are well documented. In these turbulent times, your company cannot afford to forfeit the dividends that should accrue from your investments of time, energy, and training into people.

Customers do notice turnover – particularly if they lose an individual who, to them, “is your company”. (anyone they communicate with and have come to rely in their transactions. For the customer, high turnover can symbolize a lack of stability and security in your company, casting doubt on whether they should do business with you.

All of these factors point to the critical need to develop, motivate, and retain good employees. Without this, no business strategy can be successful.

Four Value Propositions

The concept of value is at the core of any relationship, including relationships with employees and customers. Briefly stated, Value = Perceived Benefits/Perceived Costs of the Benefits, compared to other known alternatives.

Four value propositions are at the core of building productive and loyal relationships with employees.

Proposition 1: Value is fundamental to any exchange relationship.

Parties engage in a single or protracted series of exchanges, if and only if, there is a recognized level of perceived value. The existence of a differential value advantage is requisite for loyalty and retention.

This means that employees will become and/or remain committed, productive, and loyal to the organization as long as they perceive a positive ratio of benefits to costs (i.e., value). In other words, in the mind of the employee, the workplace must provide personally important tangible and emotional rewards, and those benefits must outweigh the physical/emotional requirements, difficulties, and disappointments that collectively comprise the “cost.” Employee loyalty further requires that the current working situation must be perceived to be superior to any known realistic employment alternative.

What are some of the positive motivators in the work environment, as well as some of the factors with a negative impact? The following examples have been gleaned from participants in our seminars across the country.

Benefits. Motivated employees attribute their satisfaction to such variables as:

  • praise and recognition for a job well done;
  • opportunities for input and involvement in decisions that affect them;
  • money;
  • job security (Does that still exist?);
  • access to needed information;
  • the feeling of being a part of a team;
  • accomplishment of goals;
  • challenge, and;
  • the opportunity to learn, grow, and advance in the job.

Costs. Negative forces in the work environment are motivation robbers. Our seminar participants cite such forces as:

  • the stress of nonstop change;
  • dealing with customer complaints and problems;
  • feelings of helplessness and powerlessness;
  • interpersonal conflicts and power struggles;
  • incompetent managers;
  • overly critical supervisors;
  • lack of information or training necessary to accomplish tasks;
  • disappointments in people after personal investments in their development;
  • lack of trust in management or peers;
  • frustrations with system problems or delays;
  • unrealistic time deadlines;
  • and last, but not least, inadequate monetary compensation.

Your management strategy, then, must involve a two-fold focus – increasing employee-perceived benefits and reducing employee-perceived costs. By definition, perception is an individual matter. Therefore, it is essential that the plan include asking employees what they value most, as well as what bothers them most. Further, the improvement process itself may be significantly enhanced by actively involving employees in idea generation and problem solving.

Proposition 2: Value is product/market specific.

This precept has special implications for the manager who is concerned about the organizations work force. While there is certainly a degree of human commonality with respect to motivational factors, unique preferences are a reality. Different industries, different locations, different job titles, and different individuals lead to different criteria for calculating value.

Further, preferences can change over time, being especially influenced by such factors as:

  • personal or organizational transition;
  • stages of personal and organizational maturity, and;
  • the fulfillment, or lack of fulfillment, of various needs. (Unmet needs become stronger motivators.)

Thus, it is essential to implement ongoing assessment processes designed to “take the temperature” of employees, to assess what is currently important to them, and to solicit their opinions on the organization’s performance and on improvement of opportunities for things they consider important.

Proposition 3: The organization that can identify and create value opportunities better than its competition is the one that will be best positioned to leverage this value into greater levels of profitability through enhanced employee performance and greater employee retention.

Your company’s ability to attract and keep good employees dedicated to serving customers is dependent upon its ability to create employee value better than do its competitors. This advantage translates into a more stable environment, reduced training costs, happier customers, and greater profitability.

Proposition 4: The company that can maintain an employee value advantage better than its competitors will be less vulnerable to competitive pressures to take those employees away.

Organizations providing the highest value to employees are much less vulnerable to recruitment efforts from competitors. As a result, the high-value company reaps the rewards of its own employee development and training efforts rather than witnessing talented and skilled employees slipping through its fingers and into the hands of organizations inside and outside their industry, competing for talented employees.

Dr. Bev Smallwood is a psychologist and professional speaker who is the author of “This Wasn’t Supposed to Happen to Me.” Visit her website, www.DrBevSmallwood.com; or contact Bev at 601.264.0890 or by email, Bev@DrBevSmallwood.com. Also connect with Bev on Twitter, Facebook, Linkedin, and her blogs, Shrink Rap and New Morning Devotionals.

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