In: Categories » Business » Negotiation and communication » Incentives to Tie Employees to the Company
|
Over and above the monetary compensation, many companies invest considerable efforts in creating a work environment that will bond the employees with the company and encourage them to stay with it. Recruiting a talented employee is only the first stage in the battle to keep him or her with the company. In times of prosperity on the capital market the demand for good workers is high, thus increasing the turnover rate of employees. Companies are required to make significant investments to train employees for their positions in the company, and employees reach their maximum productivity only after a certain period of adjustment. Therefore, the departure of a skilled worker translates into a significant loss to the company, far greater that the loss resulting from a failure in recruiting new employees. Many companies have been forced to increase their employees' compensation several times a year in order to keep them with the company. Option packages were an effective tool when companies managed to raise capital based on ever-increasing values. However, this effectiveness diminished when the value of the companies dropped during 2000 and 2001. Such impact was visible not only in startups, but also in more established companies. For instance, in late 2000 approximately two-thirds of Lucent Technologies' employees held options with exercise prices higher than the price of the share. The importance of the alignment of interests between employees and the company and between them and other employees cannot be overrated. This unity alone is, however, insufficient—particularly in a market with excess demand for skilled workers. Employees need to feel that the company treats them as one of its important assets, not merely as a production mechanism designed to produce a higher yield than the cost of their salaries. Therefore, many companies offer various services to enhance the employees' and their families' quality of life. In the United States, for instance, it is customary to offer employees a contribution towards kindergarten and schooling expenses, or even to maintain day care facilities in or close to the company's offices. In addition, it is customary to organize various adventure outings for the company's employees and families, vacation packages, and holiday events. In conclusion, from the points of view of the entrepreneurs and the investors, it is the effectiveness of the overall compensation package, which includes monetary and other rewards that is important. Every employee has different preferences regarding the monetary and non-monetary rewards that affect his or her decision to work with the company. It is the duty of the company's officers to put together a package of employee benefits that will attract the employees who match the profile of whom they want to recruit, that will enhance the productivity of such employees while with the company, and, of course, that will reduce the turnover rate of employees as a result of defection to other employers
 |
legal disclaimer
1) Our website is not responsible for the information contained by this article as well for any and all copyright infringements by authors and writers. E-articles is a free information resource. If you suspect this article for any copyright infringements, please read the Terms of service and contact us to investigate the problem.
2) The E-articles directory team is not responsible for inaccuracies, falsehoods, or any other types of misinformation this tutorial may contain and will not be liable for any loss or damage suffered by a user through the user's reliance on the information gained here. Please read the Terms of service
Useful tools and features
If you like this article (tutorial), please link to it from your web page using the information above. Linking to this page, this is the only way to help us improve our service, the same time providing your visitors with a way to improve their online experience.
related articles
Job Descriptions and Requirements Many positions naturally demand certain requirements with respect to education, experience, and qualifications. For instance, it is customary for CFOs (Chief Financial Officers) to be qualified in accounting and finance and usually to have an MBA. However, in many cases, companies define prerequisites that are not essential to the nature of the position, but are rather the result of norms. In practice, many companies find that relevant experience, if it is accompanied by profound profes...
2. Employee Compensation in the Technology Segments
One of the main objectives of companies in general, and startups in particular, is to navigate the company to a path of rapid growth that will enhance its profits and establish its financial stability. Since the development of products is based primarily on the human factor, the recruitment of talented employees and enhancing their bonding with the company are crucial elements on the road to the company's success. As in any field, companies, including startups, also seek to compensate their employees in order to bring out the b...
3. Reasons Why We Are Poor Listeners
Lazy listening is enormously costly to our success. Most of us think we are good listeners, but that overconfidence may be the reason for our downfall. Nothing puts a sales call in jeopardy faster than poor, inattentive listening. Customers don't take long to get a sense of your listening commitment, especially given the fact that 90% of communication is nonverbal. That's right, 90%. About 55% is through obvious body language and 35% is by how you say it. Given these overwhelming statistics, it's pretty tough to convinc...
4. The Five Principles of Creative Negotiation
Dealing with conflict and differences is rarely an easy task. Barriers to creative negotiation can be numerous and are often the saboteurs of a potential sale. Remember: your goal is to reach win-win-win-win settlements with qualified customers. To that end, I offer these five principles of creative sales negotiation: Principle #1: Attitude First Are you a good negotiator? Your answer reflects your level of confidence in your negotiation skills. Creating a positive mindset involves basic attitudinal charac...
5. WHAT IS WRONG WITH MEETINGS
Review the following questions and check the ones that can be answered with a “yes.” - Have you attended meetings where you did not get the information you needed? - Have you attended meetings where the atmosphere was hostile or abusive? - Have you attended meetings where most of the decisions were postponed? - Have you attended meetings where the purposes was unclear? In all the cases where the answer was a yes, the meeting was not an effective coordination tool....
6. USING PROJECT MEETINGS AS SUCCESSFUL COORDINATION TOOLS
For project meetings to serve as communication and coordination tools they have to achieve the following goals: - Inform project members - Provide opportunities to contribute expertise and knowledge - Achieve agreement and support for the outcome To attain these goals this article has focused on three aspects of meetings: 1. A well-defined purpose 2. A tangible outcome 3. A comfortable and supportive atmosphere All three are important for successful and effective communic...
7. How to make meetings a valuable communication tool
What do meetings that one experienced as valuable to attend — meetings one keeps going back to — have in common? Here are some responses people gave in a survey for a project post-mortem: - The meetings address issues of concern. - It is important to get everyone face to face, but also limit the time spent doing so. - Everyone gets the same information. - Everyone is made aware of the changes. Personally, the Sunday church meetings and the weekly toastmaster’s meetings are ...
8. How to make meeting participants feel confortable
Meeting participants will feel more comfortable, if: - A meeting adheres to a common format. - The facilitator provides guidance. - The facilitator uses context-free questions to solicit needs and feelings. People feel comfortable if they know what they can expect. Think of that recent Sunday church meeting. How is it different from the one before? It is the content that is different, but not the format. A common format makes people feel comfortable that they can participate and that they know how. Thi...