Periodically I will share with you an issue that was discussed at a monthly meeting of my CEO private advisory board. This is a group of business owners who meet once a month to share issues facing them and get feedback from their peers.
Last week a member posed the question of raises or bonuses? As an engineering company they employ highly specialized engineers to work on specific projects for clients. Recently, some of their engineers have become proficient in a unique software program that has increased the company’s awareness in a niche industry segment. As a result these engineers have become personally recognized within this industry segment.
The dilemma facing my member is that these knowledge workers, who he has paid to become proficient in this technology, could leave him to go to work for the highest bidder. His question to the group was, “Do I give them raises to stay (a permanent financial commitment) or a bonus (a one-time financial commitment)?”
He cannot afford to give all of the engineers a financial bump right now. So does he give it to his one or two key people and risk the others finding out about it? His fear is that those who don’t get an increase might leave him. He also has the fear that what he may offer the key engineers may not be enough and he risks losing them anyway.
One member suggested a middle-of-the-road offer. Give them a bonus that you can afford. It may not be what they want and that’s okay. They can be a little unhappy just not unhappy enough to quit.
Another suggested having a conversation with them and asking, “If you could design your ideal job what would it look like”? This discussion should uncover what is annoying them about their job. Is it the long hours, which is cutting into family time? Is it the frustration of not being able to get their work done? Is money really a factor or can you solve the issue by providing more vacation time or more flexible work hours? In lieu of dollars what if I bought you a new camera or sent you to Europe? Until you have this conversation you are fearful of YOUR “story” which is the one you make up in your mind. After you have the conversation with them you now know THEIR story, which is the one you want to remedy.
One member says he often reminds his employees of the sacrifices he made during an economic downturn to keep the business operating. This may have been by taking a second mortgage out to meet payroll and/or foregoing a salary for a certain period of time. Whatever you wish to disclose is up to you. The point is often times employees do not know to what extend owners go to make sure the business survives and all of your employees benefited from your sacrifices.
My member decided he would have an honest conversation with his one key employee, who he knew would keep the discussion confidential. He will let him know how much he was appreciated; explain his fear of losing him; and find out what it will take to make him happy. He will report back to the group next month the results of that dialog.
Consider Reading This
Fierce Conversations: Achieving Success at Work and in Life One Conversation at a Time by Susan Scott. One of the best books I have read on communication and having that difficult conversation with a co-worker or family member. Great lessons on how to have those conversations without making the other person wrong. Using examples from her experience as an executive coach to CEOs Scott teaches us how to have harmony in our life by creating positive outcomes in situations we prefer to avoid.