Your Recognition and Engagement Questions, Answered

Recognition expert Bob Nelson was the keynote speaker for Workforce Management’s inaugural online conference, “Road to Recovery: HR Strategies for 2010,” which drew more than 4,000 registrants. Nelson agreed to answer all the questions that were asked during his keynote session. Here, arranged by topic, are his answers to more than 40 questions on topics ranging from how to honestly communicate about layoffs to how to gently reject employee ideas that aren’t viable without demotivating the people suggesting them.

Dealing with the down economy—particularly during layoffs  

Best practices in recognition

Cash vs. noncash rewards

Recognition issues with managers and bosses

What to do when employees don’t seem to appreciation your recognition efforts

Dealing with the down economy—particularly during layoffs

Workforce: How do you handle “open and honest communication” with employees when managers are prepping for layoffs?

Bob Nelson: I’d especially be open about potential layoffs with employees, sharing why that is being looked at and what needs to happen to avoid a layoff. The last place any employee wants to read about a layoff at their firm is in the newspaper. And if managers are suddenly in closed-door meetings all the time, employees will already expect that layoffs are being discussed.

Employees expect to get important information directly from their managers or leadership of the organization, even when it’s negative. This treats employees in an honest and respectful manner and gives them a chance to respond proactively with ways to help cut costs and impact services (such as customer service) in ways that can increase the firm’s revenues.

One caveat: The deal management should make with employees is that they will share information when they have it, provided that employees realize it is subject to change with circumstances. When I’ve seen management that was reluctant to share information with employees, there was often a fear on management’s part that the information they shared might be wrong sometime later. That’s the risk in sharing real-time information in dynamic times: Things change.

Workforce: Many organizations downsize due to the economic situation and not because of performance. HR always tries to motivate staff, but sometimes, in spite of better performance of staff, the organization still cuts jobs. It is very challenging and sometimes employees lose trust in HR. How do we manage this aspect?

Nelson: Well, first, management shouldn’t be hiding behind HR so that they are the “bad guys.” Management and HR need to work together to educate employees as to why the organization cuts or adds positions and how those decisions directly relate to the financials of the organization. In fact, I know some organizations in which HR is perceived as the “hero” when layoffs occur.

By being diligent in working with management to offer employees other options—such as transferring to other positions, taking a temporary pay cut, or cutting back their hours rather than to lose their job—often the total number of layoffs can be greatly reduced. Providing employees options and choices in tough times helps give them some sense of control in the situation and lessens the negative impact of a negative situation.

Workforce: If we aren’t going to see a real recovery until mid-decade, where are all these unhappy workers going to go? Won’t their unhappiness deepen and grow? How can both managers and workers cope with that?

Nelson: The reference I made was to a recent projection by UCLA economist David Shulman: “By mid-decade, economic growth could return to the 3 to 4 percent range, with unemployment back into mid-single digits.”

Youch! Again, this is why I believe companies are going to need to become more proactive in dealing with the impact of a recessionary economy on their existing employees (that is, those who haven’t been laid off). According to CareerBuilder.com, nearly 50 percent of workers surviving layoffs have indicated they’ve taken on more responsibility; 37 percent are handling the work of two employees; 34 percent are spending more time at the office; and 22 percent are working more weekends.

Tough times require strong leadership, and management in every company is going to have to suck it up and be better at boosting the morale of workers. This leads to asking: What are we going to do for our managers? Hopefully that will be on the radar for companies as well.

Workforce: You seem to concentrate on motivating employees. However, in a down economy, the first thing done by the employer is cutting the number of employees through restructuring and other means. As result, an insecure atmosphere among employees will be created. So how you are going to motivate them when they see their colleagues are laid off, expecting that they are next on the line?

Nelson: This is, in fact, the challenge. Given tough economic times and the likelihood of having to have done layoffs or salary and bonus freezes, etc., my view is that you have to work doubly hard to overcome those circumstances and the ongoing negativity of the stagnant economy. Granted, this starts with the decisions you’ve already made and how the “people issues” were handled with those changes. Was communication open and honest, or guarded and secretive? Was management empathetic and helpful as best could be expected, or cold and calculating? After negative changes in the organization, if you are not aggressive in reaching out to employees, describing a possible future with a solid plan to achieve it and challenging employees in new ways, they will be apt to become increasingly scared, nervous and myopic. This makes it harder for them to focus in their jobs on those things you most need them to do, such as exceptional service, enhanced efficiency, increased suggestions regarding cost savings, client referrals, up-selling and so forth.

Workforce: Although [we’re] trying recognition methods and praise, employees feel insecure because of large-scale obligatory terminations. So what is the best way to keep solid relationships between employees and management?

Nelson: There’s no substitute for direct, honest and sincere communication, plus systematically showing employees through your actions that “We’re in this together.” As Stephen Covey once said, “You can’t talk yourself out of a situation you acted yourself into.” So what is going to speak loudest are your behaviors over time, more so than the things you say. You’ve got to walk your talk and show that your employees are truly important through your actions—hopefully as consistently as possible during these dynamic times.

Workforce: Our company has announced to our population that salaries have been frozen, due to the economy, yet departments considered revenue generators are receiving increases and bonuses. These discretionary increases have become public knowledge and many employees are disappointed by this news. Can you provide advice on how the company and top management should honestly address the fact that some departments are still receiving increases and why others are not?

Nelson: These types of perceived inconsistencies are difficult to defend if you are trying to build team spirit in challenging times. To avoid the situation from looking arbitrary or like a case of playing favorites, management would need to justify why it’s important for those positions to continue to receive salary increases and/or bonuses. For example, in hospitals today there is a national nursing shortage so there is a logic to continuing to pay nurses financial incentives, even as those financial incentives are being cut elsewhere throughout the hospital. Right now, nurses are too scarce and indispensable to the successful operation of the organization and its mission. This may be the case with the revenue generators in your organization.

But if those revenue generators are not making their financial goals (thus the organizational cuts), rewarding them with financial incentives would be rewarding poor performance. Beware! That will be a slippery slope that may very well lead to a much worse situation.

Workforce: When job markets reawaken, will management be able to hold on to people they now employ—people who are waiting to escape to better jobs, leadership and work conditions? Do you believe many companies are in for turnover shock, and do any employers know where they are vulnerable?

Nelson: I believe many employers will be surprised at the number of employees who choose to leave their firms as the economy improves—especially those firms that openly treated employees differently (and poorly) under the notion that “It’s a tough market out there and you should be glad you even have a job.” Hate to break it to you employers who believe that, but being told what they should appreciate really doesn’t make any employee feel special. It can, however, convince them that they are working for a jerk.

I remember working for a 7-Eleven when I was in college, during a previous recession, and one day the regional manager came in and gave us all a speech along the lines of “If you don’t like it here, there’s a lot of other people that are willing to take your place.” “Really?” I thought. “They can have it.” I quit the same day.

Workforce: What happens when you have cut all types of benefits that cost money—even the little ones?

Nelson: Hopefully that helped your company be solvent during these tough economic times, but on the human side of enterprise such draconian financial cuts are apt to take a toll on employee morale and motivation. Try to take up some of that slack with creative low- or no-cost forms of recognition, simple celebrations, personal thanks, etc. When money does become more available, remember to take care of your people first—especially those who have best helped you weather the storm.

Workforce: What are some strategies for retaining employees when there isn’t any money available for promotions, bonuses or training?

Nelson: I’ve mentioned several strategies in the answers here, but one I haven’t discussed relates to career development.

You can’t guarantee employees that they will be promoted, but you can work with them to guarantee they will learn new skills and let them know that developing their abilities will help put them in line for promotions when those are available. In this way, a recessionary time provides ample opportunities for employees to take on needed work, pursue ideas that can help the organization and generally increase the contribution they can make at work. These skills, abilities and visibility for achieving desired results all help to put them in line for future advancement opportunities within your organization.

Workforce: What is your recommendation: big bang or small changes as you edge forward through the uncertainty? Talent loss is very costly.

Nelson: I’m more partial to the incremental approach to improving things over time. However, there is merit to doing some very visible items that send a message to everyone that you care as an organization, or that you’ve turned the corner in your firm’s recovery.

Workforce: I would be interested to hear if Dr. Nelson has any thoughts on the role of leaders role-modeling desired behaviors. Granted, this is desirable under the best of times, but any thoughts on whether this takes on more significance during tough times?

Nelson: Yes, it does indeed take on more significance.

Leaders have to be much more visible during times of crisis. They also need to be more accessible, more collaborative and more supportive, openly thanking and acknowledging others as that recognition is deserved. As they demonstrate these behaviors in their daily routine, they send a behavioral message to all other leaders in the organization as to what is expected of them. Other leaders can conclude, “If top management has time for this type of activity, I need to find time for it in my job as well.”

Workforce: You said that 75 percent of younger employees plan to look for a new job when economy improves. What age range does this apply to?

Nelson: Now that I look at it again, it’s actually 71 percent. This applies to those employees who are 18 to 29 years old, as reported by Adecco Groups North America’s Workplace Insights Survey (June, 2009).

Workforce: Bob, how does innovation link onto the six strategies to use during tough times?

Nelson: As a recap, the six strategies are:

1) Create a clear and compelling direction.

2) Direct, open and honest communication.

3) Involve employees and encourage initiative.

4) Increase employee autonomy, flexibility and support.

5) Career growth and development.

6) Recognize and reward performance.

And they link very well to innovation, thank you! As you involve and encourage others on a systematic basis, it leads to them trusting and developing their ideas and, voila: innovation. You can’t legislate or force employees to be creative, although there are many things you can do to support and encourage innovation at work.

Workforce: Can you tell us more about the research that these best practices came from?

Nelson: The research for best practices for firms during recessionary times is my own research, combined with that of other studies—most notably by Quantum Workplace, an engagement research firm that did a national comparative survey of U.S. companies in 2007 and 2008. It found that 66 percent of the firms surveyed had decreases in their employee engagement, while 33 percent had increases in their employee engagement scores. “Employee engagement is measured by the ability and willingness of individuals to exert extra effort for the benefit of the company, their tendency to speak highly of the organization and their intent to stay,” according to Greg Harris, the firm’s CEO.

Quantum Workplace surveys more than 1.5 million employees among 5,000 companies nationwide. The surveys are conducted at different times of the year, but at the same time of the year in each location. By an almost 2-to-1 margin (134 to 76), more employers surveyed had lower overall employee engagement scores in fall 2008 than in fall 2007. This result was out of the ordinary from trends over the previous five years, and strongly suggested that external circumstances regarding the economy may well be influencing employees’ attitudes about their jobs and workplaces.

To explore the issue further, the firm conducted an analysis of the 210 companies, including those that had higher engagement scores and those whose scores had dropped off. The analysis uncovered key differentiators that reveal how some employers are increasing engagement while others may be losing their hold. The engagement winners were:

1. Setting a clear, compelling direction that empowers each employee.

2. Maintaining open and honest communication.

3. Continuing focus on career growth and development.

4. Recognizing and rewarding high performance.

5. Providing employee benefits that demonstrate a strong commitment to employee well-being.

These key differentiators served as a focus and discussion of Keeping Up in a Down Economy, with several added dimensions from my own research (involving employees and encouraging initiative, as well as increasing employee autonomy, flexibility and support).

Back to topics

Best practices in recognition

Workforce: Where is the best place to give recognition—in front of teammates, or privately?

Nelson: This depends upon the individual, which is why you should try to ask and involve employees in determining those things that are the greatest motivators for them. As a rule of thumb, you should praise publicly and reprimand privately, but some 20 to 30 percent of employees are more introverted and do not want public praise.

An example: An employee who was to receive a perfect-attendance award at his company from the president in front of the entire company was so nervous that he called in sick on the day of the presentation.

What definitely doesn’t work is to force on employees a recognition that they don’t value. One size doesn’t fit all anymore, and just because you have an established recognition program (e.g., employee of the month) doesn’t mean everybody wants what that program offers, such as a plaque, a luncheon with management or a gift out of a rewards catalog. The best recognition is tailored to what the recipient most wants. When in doubt, you can at least give employees a choice of things that are truly different from one another. That improves the chances that your employees will find something of value to them.

Workforce: Have you ever experienced overused praise or recognition that no longer seemed fresh or sincere—or no longer seemed special?

Nelson: Yes. Although I feel the value of praise is almost universal, if it is poorly done—becoming mechanical, for example—it can lose its specialness. That’s why it is important to keep praise timely, sincere and specific with each and every use. If you do it correctly, I’ve never found an employee who is tired of being told that they have done a good job! If it comes from the heart, praise will resonate in the soul.

Workforce: What are the challenges in employee recognition in an offshore environment or multilocation businesses? How can those challenges be overcome?

Nelson: The more distributed your employees are, the more difficulty you will have in connecting with them in meaningful ways. Everything—communication, recognition—in such circumstances takes more effort to do well.

You can rally around core values that are reinforced both centrally and locally. That’s one successful strategy many firms have adopted. You can allow for a greater local focus on recognition—that can also be successful. For example, set up a voluntary recognition task force at each facility or location to systematically focus on the topic in ways that employees at each location find meaningful.

Sometimes organizations get hung up on trying to do the exact same things for employees wherever they are located, but this is silly if the employees’ needs and expectations vary greatly from location to location.

For example, an international company will have great difficulty in recognizing employees if they decide to reward them all across borders in exactly the same way—with, say, a $50 item. In one country, this item may end up costing $150 due to exchange rates, while in another it might represent a week’s pay for an employee. It’s better to make local adjustments that make sense in meeting the motivational needs of employees at each location.

You might want to check out these articles of mine that deal with the subject: “Finding Ways to Recognize Long-Distance Employees” or the article reprint “Motivating Employees From a Distance.”

Q: How do you get all employees on board with a recognition program?

Nelson: Involve them in developing all aspects of the program so that it is truly their program and not the company’s, corporate’s or HR’s program. Build the program over time to affect an increasing number of employees in your organization. Look at who is served by your existing recognition tools and programs and seek to fill the gaps of those that aren’t being reached over time.

Workforce: How do you “reject” ideas that are not viable without discouraging people?

Nelson: Thank them for their ideas and the time they took to submit them, while sharing why it isn’t plausible for the firm right now. I know of one company where the president is the one who personally takes undoable suggestions back to the person who suggested them (within 24 hours of the idea being submitted, by the way) and thanks and discusses each idea with the individual. That positive, proactive approach sends a big message that underscores the importance of generating ideas over the merits of any one idea that has been suggested.

Workforce: Our company has done some brainstorming meetings, but nothing seems to happen with the ideas because we are short-staffed and management gets distracted from following through. Do you have ideas for keeping this momentum moving forward?

Nelson: Yes. We know from basic social psychology that when many people could do something about a problem, no one person tends to do anything. The key is to assign individual responsibility for items so that someone can be held accountable. At the end of your next brainstorming, ask everyone to volunteer to follow up on a single idea that was discussed, creating a set of “action steps” for each item, each with a due date. Capture that list of items with names and use it to start the next brainstorming session, which will naturally take you further into the implementation of previous ideas and not just the generation of new ones.

Workforce: I work in a very diverse group. We all do different things and really don’t know what others are doing. So I suggested we do a “kudos” portion in staff meetings, where I can say one thing that I did or accomplished that I am proud of that others may not know about. People don’t want to participate. I must have approached it wrong, but I think the concept is good. Any thoughts?

Nelson: If at first you don’t succeed … . I think you have a winning idea here as well. But some people may not want to brag about themselves and others may feel pressure to come up with something or risk looking like a slacker. Perhaps you could modify your approach to this: allowing anyone a chance to thank or recognize another person in the group. Let those who want to share do so. After doing this a few times, you will likely find more people wanting to contribute.

Another version of this is to start each meeting with the group listing five things that are going well. I know a manager at Disney who does this and it works well.

Workforce: Is there any different pattern in employee recognition between service-oriented organizations and research-oriented organizations?

Nelson: Yes, just in that these two types of organizations tend to have very different employee populations. Service-oriented organizations, which currently make up 80 percent of all jobs, are often lower-paying positions with higher amounts of customer contact (there are exceptions to this, of course). Having these employees be truly excited about wanting to deliver great service would suggest that a higher frequency and variety of forms of recognition be used.

A research-oriented organization suggests (to me) a more highly educated and technical workforce that would likely respond better to a different mix of recognition. For example, for most technical employees, the chance to work on the “hot” project or to learn new skills that will increase their worth now and in the future is paramount. Giving such employees a chance to select the projects they can work on would thus be a big motivator to most. Technical employees also tend to be (another generalization!) more introverted, so they might better appreciate a thoughtful gift over a splashy public form of recognition in front of the whole staff. When in doubt, ask them what would be most motivating and you’ll be surprised by the responses!

Workforce: How should you recognize tenure?

Nelson: Honestly, the best way would be to ask your employees how they’d like to have it recognized! They did just that at Medtronic in Minneapolis, and employees reported that they’d most like additional vacation time for their anniversary awards. The company complied and phased out its gift-selection program and moved to giving more time off instead. Of course, saying something, having a note or card or—for more significant anniversaries— creating a “memory scrapbook” that everyone can contribute to are items that are long on value and short on cost.

Workforce: We used to have what we called “on-the-spot” rewards, which were gift certificates that could be given out immediately to an employee for doing something extra or doing something well. However, our new CFO told us we needed to then add the dollar amount of the reward to the employees’ W-2s, and that it’s taxable. Have you run into that anywhere? Know any solutions to avoid that?”

Nelson: There are several ways to minimize this negative impact on employees. First, use reward items that don’t have a financial cost!

Second, keep rewards that do have a financial cost to a minimal level of $25 per year, known as “de minimis fringe” by the IRS. These are then not considered taxable.

Third, if financial items are required to be taxed, you can pay the employee’s tax out of the award. For example, give them a $40 valued item that may cost the company $50. Or you can bulk the award up, so that the company pays the tax on the reward item—perhaps $10 on a $50 item. There are other creative strategies that you can do that are still within the letter of the law. Please see my article “Beware Tax Implications of Recognition Programs,” or a short Q&A on the same subject, “Tax Implications of Recognition Rewards.”

Workforce: How many of your strategies tie specifically to the varied generations in the workplace?

Nelson: I think most all of them can. By having the widest spectrum of recognition and reward possibilities, you can provide the greatest choice for employees of different generations to select those things, activities or privileges that they each find most motivating. An older employee might respond better to a traditional award while a younger employee might be more attracted to a fun, social activity.

Back to topics

Cash vs. Noncash Rewards

Workforce: What do you think is the No. 1 incentive for employees?

Nelson: After money, it’s to be trusted and respected, as evidenced by how you are treated on a day-to-day basis. That means being asked your opinion, supported in your job, involved in decision making, thanked and recognized as appropriate when you have performed well.

Q: Reward and recognition are critical, agreed. Any statistics on the role of nonfinancial rewards versus financial in terms of how people rank these two types of rewards—especially in challenging times?

Nelson: I try not to pit financial against nonfinancial incentives, in that they are both important. Would you rather have air or water to live? Gee, don’t we need both?

No one is every going to say no to getting paid more, either in their paycheck, as a merit raise or bonus or an “on the spot” award. (Although my wife, Jennifer, did once decline a pay increase in a job she had. She told her manager that she thought she already was fairly paid. They still gave her the raise, by the way.)

Especially in tight times, as people have a higher need for money to meet their financial commitments, money is, and is going to remain, a top priority and motivator. But as financial rewards are harder to come by in recessionary economic times, it is important to realize that nonfinancial rewards can be highly valued by employees as well.

For example, consider time off of work, in its many forms (flextime, comp time, an extended lunch, an afternoon or day off, etc). Studies clearly indicate time, and the availability of time, has an expanding importance to today’s employees, 86 percent of whom report that they “wish they had more time to spend with their family,” for example (this is from survey research I’ve conducted).

Likewise, a nonfinancial motivator such as telecommuting (which 42 percent of current employers allow some form of with their employees) speaks to time needs, such as saving commute time. It also helps an employee balance their work and personal priorities, and it carries a sense of autonomy, as well as the employer’s trust and respect. All of these are important needs to most employees today.

I would say that in challenging times, intangible rewards such as those I’ve referenced are still high in importance. But if companies are able to provide financial incentives as the economy and the company’s financials improve, employees do expect to see those financial rewards in their pay as they continue to perform well.

Workforce: What do you do when you do not have the money for monetary rewards such as merit increases and bonuses? Eventually, people want their bonuses and increases for the work they have done.

Nelson: Yes, agreed, and there will be a pent-up demand for lost or postponed merit increases and bonuses that need to be addressed when the company is financially able to do so. In the meantime there are LOTS of other ways to show employees that you know and appreciate the hard work they are doing, some of which can be symbolic in just showing “We’re all in it together.”

That’s why I love examples like the executives at Proforma Worldwide Support Center in Cleveland, who recently agreed they will scrape the snow off of all 100 employees’ cars this winter. Silly? Perhaps. But it’s impactful in showing through their behaviors that they are rallying with their employees during these challenging times.

Workforce: Please share information regarding setting up a pay-for-performance plan.

Nelson: Pay for performance is a financial incentive plan, which is really outside my area of expertise and experience. I will say, however, that it’s important to be very clear about the priority of those things you want to incentivize. Employees will “game” incentives to maximize their financial gain.

Workforce: Beyond pay for performance, what type of recognition is relevant for today’s employees?

Nelson: I’d call pay for performance a compensation factor, not a recognition factor. But in terms of what type of recognition is especially important during recessionary times, I’d say it’s looking harder for incremental improvements toward desired goals that you can acknowledge, recognize or celebrate. I also believe increased communication, involvement and autonomy on the part of your employees to be important recognition factors.

I don’t know a more motivating thing to do with employees than asking them their opinion, or asking for an idea or suggestion as to how they believe things could be improved. Having done that, you encourage them to pursue that idea or suggestion and you support, thank and acknowledge any success they might have for their efforts. When they make a mistake, you handle it as a learning opportunity, not a chance to find fault.

Workforce: What about the large institutions (such as AIG) using this approach (as opposed to large bonuses that infuriate the public) for better PR during tough times?

Nelson: It’s funny, but someone from AIG contacted me a few years ago and wanted help on exactly this! But it’s very difficult for nonmonetary recognition to compete with financial compensation, which trumps the discussion. I think there is no way to justify the insane executive bonuses that were given, other than saying that they did it because they could. The only fix to such excess is to stop it, and add some guarantees so that it doesn’t happen again. Also, doing things just for their PR value is a pretty manipulative approach that most of the now-jaded public would see through.

Back to topics

Recognition issues with managers and bosses

Workforce: How do you deal with a supervisor who does not believe in recognition or believes that the employee is just doing their job? Are there some criteria that could be provided to outline possible acts that could be recognized?

Nelson: I wish I had a dollar for every time I’ve heard this concern! Clearly there is a significant percentage of the management population that doesn’t “get” recognition—why to do it, when to do it, how to do it, how to keep it fresh, when they’ve done it enough, etc. In fact, in my doctoral research I found that the No. 1 reason why managers don’t recognize their employees is that they weren’t sure how to do it well. You need a “head, hands and heart” approach to changing this situation with managers.

You’ve got to raise their awareness about the importance of this activity—that is, their conceptual model for managing (the head). You need to show them explicitly how to do recognition—that is, the tools, practices and behaviors of what it looks like in practice (the hands). You do all this to the point where they try and succeed at the behavior, which then tends to affect their beliefs and passion in doing it (the heart).

As to specific criteria that could be provided to outline possible acts that could be recognized, many organizations tie recognition to core values of the organization, but more specific recognition needs to be a function of the desired performance in each employee’s job. That is, it needs to be individualized for each employee. Managers need to set specific goals with each employee and then be on the lookout for successes each employee has in the implementation of his or her job.

Workforce: How do you persuade your employer/sole owner that he needs to involve other people in decision making besides his three favorite top managers? He is a micromanager and likes to hold information only for himself.

Nelson: What I’ve seen work best with this is getting the person to try involving others—because they might just like it! If top managers open up discussion to other committed employees of the firm, each of whom has a valued perspective and contribution to make, they can be pleasantly surprised at the quality of contributions and what they themselves can learn from their employees.

A micromanager is someone who has trust problems with employees—perhaps well learned from his or her own experience in having been burned by past employees. You can help this employer learn new behavior. It doesn’t have to be all or nothing (i.e., “I do the work or you do the work, but there’s no option in between”), but instead a gradual evolution toward including others.

You can also start at the bottom and work up. There’s a level of decision making that can start with employees in those areas in which they feel they can have the greatest impact. As they make changes and have positive impact, you can use that success in leveraging their greater involvement with top management.

Workforce: What is the most critical skill that leaders need to help their organization and its employees handle the stress and concerns during these tough times?

Nelson: I tried to focus on a short list in my new book, Keeping Up in a Down Economy, but if there was one single critical skill I’d advocate, it would be communication—specifically open, honest and direct communication. Earlier this year, Accountemps released a survey of executives that focused on employee morale. It found a lack of honest communication to be the behavior that has the most negative effect on employee morale. Thirty-three percent of those surveyed cited it. Meanwhile, 48 percent said communication was one of the best remedies for poor morale.

Workforce: What is the one biggest derailer that leaders are guilty of with respect to keeping employees up in a down economy?

Nelson: We all have fallback styles when we’re under stress or pressure. And for many leaders, their fallback style is to “take charge” and be in control at all costs, which often serves to exacerbate the situation.

When a leader takes greater control, it sends the message to employees that they are trusted less, and the employees’ behavior will follow suit. They will exert less effort, rather than more. Instead of becoming insecure micromanagers during challenging times, the best leaders reach out to their people and challenge them to be better and to rise to the situation required by external circumstances.

Q: Some of my managers associate power with projects; they don’t want to delegate a thing (not even as a reward and recognition tool)! How do I get them to think differently about this and see how it could help us build morale?

Nelson: Effective delegation is a skill set that, unfortunately, many managers never have had a chance to learn. Many are promoted to management and interpret the job to mean that they now need to be a “super worker” instead of being someone who gets work done through others. By holding on to all work and related projects themselves, they may have a feeling of power, but their effectiveness will diminish over time; they truly aren’t doing the job they were hired to do. Being a super worker may stroke their ego and their importance, but it does little to develop the skills and abilities of their staff members, who will be inclined to leave, due to how little real responsibility they have been given.

I’d recommend some coaching or training on the topic, which can start with a good book that addresses the problem. I’ve done two books on effective delegation, including Delegation: The Power of Letting Go.

Workforce: If your organization is widely dispersed geographically in many small locations (bank branches, chain retailers, service-management providers at client locations), how do you determine which of your unit heads are leading well, and which ones may be dictatorial, arbitrary, bullies, etc., when you do not have all employees in big locations with HR people handy?

Nelson: A good survey mechanism would help you capture this information. And part of that survey needs to have open-ended questions on what is going well and what could be improved. Open-ended questions are especially important around those items that employees rank either very high or very low. Focus groups or informal interviews are another way to get at the real story of how managers are leading. Then you need to develop a follow-up plan for addressing deficiencies within the organization.

Workforce: How do we get top management buy-in on HR strategies, especially those that border on welfare?

Nelson: If the strategies you are discussing border on welfare, you’re likely to never get top management to buy into them, and perhaps rightfully so. American business and capitalism are meritocracies in which there is an underlying value of earned rewards for valued results and performance.

You didn’t explain what you meant by “welfare” in a business environment, but if you are advocating HR strategies that treat employees based on their needs over the needs of the organization and its ability to thrive and survive, this will never be a winning strategy for any company that wants to remain competitive in changing, dynamic times.

If, on the other hand, you can show that the HR strategies you are advocating are directly linked to the firm’s performance and productivity, and you can demonstrate that those HR investments give the firm the ability to hold on to your employees (especially those that are the most significant contributors) and that they help attract additional needed talent as the organization’s demands require that talent, that’s quite a different proposition. There’s quite a lot you can do to make the case for an HR strategy to be a hard-edged, strategic decision, not a warm and fuzzy people issue.

Translate what you want to do into terms your top management can understand and value. Talk top management’s language in terms of costs and benefits and quantify any discussion on its impact on the organization’s strategies and finances. For more discussion and effective strategies for “selling” HR initiatives to those above you in your organization, see Chapter 13 of The 1001 Rewards & Recognition Fieldbook: The Complete Guide.

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What to do when employees don’t seem to appreciate your recognition efforts

Workforce: Your example of allowing employees to work nine-hour days to get Fridays off is a nice benefit. However, how do you avoid employees from abusing this, such as an employee not working the full nine hours for four days but still expect to be off on Friday? If they don’t get it, they think it is unfair or discriminatory in some way.

Nelson: This is a matter of being clear in your criteria and then holding to it. For example, I know a department manager who allowed employees to leave early on Fridays if the department’s work was done. Some of the employees took this as a given that they would always get Friday afternoons off. This department manager had to be diligent in catching employees on busy weeks to say, “Our work isn’t all done this week.”

A good way to try a program like this is to make it a pilot. That lets you test the maturity of your workers in handling this type of freedom. Make it clear from the beginning that if there are any problems, the program will be suspended. Some workers might abuse the benefit, but others will be quick to catch them on it, since they want the pilot program to succeed. Don’t expect it to work perfectly when you launch the program—it’s more important that you are flexible in making adjustments over time that will result in a better program that ultimately becomes a success.

Workforce: What do you do for employees who believe that even though they received a reward, it’s just not enough?

Nelson: It’s not clear if you are referring to a financial reward or some other type. If it’s the former, you certainly should not provide them with more financial rewards, just based on their desire to have more (the squeaky-wheel syndrome). The financial rewards need to be in proportion to the value of the employee’s contribution.

I’d have a discussion with the employee about the reward. Discuss what is needed from the organization’s perspective in order to grant more money. Maybe you want employees to increase their work contribution or share of responsibility, for example. Then help show the employees how they can learn new skills and take on more responsibility in their current positions, which will likely lead to greater financial returns over time.

If the reward was not financial, but it was perceived as not enough, I’d also have a discussion with the employees to see what reward might have been more motivating. You could provide exactly that—either now or in the future, when performance merits it.

Workforce: Our company has done several [of the things] on your list of Recognition and Rewards for Tough Times, but our employees are still not grateful. Is there some underlying issue that we are missing?

Nelson: No. Many employees today are hurting and suspicious right now, even if you are doing your best to be fair with them. You just have to be patient in showing that you are with them and will continue to act in ways that are consistent with showing they really are a priority for you and your organization.

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