Talent Management – How to Best Reward High Performers
There is some controversy in the talent management arena about how to best reward high performers. Most everyone wants to create and reward high performance, but their is not much agreement about the role that extrinsic motivators like money can play in creating a high performance culture.
Recent Rewards and Recognition Research
While the majority of our clients use pay-for-performance as a component of their total rewards and recognition philosophy to create a high performance culture and reward high performers, a recent survey by Willis Towers Watson found that:
The Role of Intrinsic and Extrinsic Motivators
To complicate matters, authors like Dan Pink have pushed the idea that intrinsic motivators like autonomy, mastery and purpose drive real and lasting motivation, not extrinsic rewards like money. In a similar vein, psychologists tell us that extrinsic rewards to reward high performers only temporarily change what people do. They assert that rewards like bonuses, vacations and other awards do not change the underlying attitudes and beliefs required for lasting and committed behavior change.
Some even postulate that financial rewards can ultimately have a negative impact on intrinsic goals like personal growth and engagement.
What Role Should Rewards Play in Your Talent Management Strategy?
So when you want to help your people perform at their peak and move the business strategy forward in a way that makes sense, what role should rewards play in your talent management strategy? How should you reward high performers?
How to Best Reward High Performers
1. Base Salary
Let’s start with base salary. We consider base salary a “ticket to play the game.” From our perspective, base pay is a talent management hygiene factor that needs to be at a certain level to be a positive factor in ensuring a healthy organizational culture.
Similar to basic levels of employee engagement, leadership, trust, safety, ethics, character and respect, base salaries need to be good enough that they don’t demotivate or undermine performance. But it doesn’t necessarily follow that significantly increasing a person’s base salary results in higher levels of performance.
So it is not ALL about the money.
Our Advice on Base Salary
If you want employees to be truly engaged, find the sweet spot of base pay that does not serve as the sole motivation for people to join or stay.
2. Pay for Performance
Assuming your base pay is at an acceptable and healthy level to attract and retain the talent you need, the next question becomes how to best use performance-based rewards to motivate high performance. We believe that it is a leader’s job, and the purpose of an effective talent management strategy, to create the circumstances to get the most out of their people.
And we know that rewards and recognition play a major role in shaping a work environment.
Like most talent management challenges, tying rewards to performance or performance reviews has both pros and cons. Most of the pros relate to being able to better attract and reward those who deserve it while most cons relate to subjectivity, politics and muddying the waters with respect to career and performance development.
Our Advice on Pay for Performance
For people to strive to perform at their peak there should be, in addition to the intrinsic motivators tied to your corporate culture, a commensurate level of rewards and recognition tied to their higher performance in a way that aligns with the overall company strategy. To get it right, make sure that your rewards and recognition create desire and motivation to perform by:
3. Intrinsic Motivation
Once your extrinsic motivators of base pay and pay for performance are in place, you should make sure that you have created strong enough intrinsic reasons for people to stay and to perform. If your organizational culture is devoid of meaning, you will most likely see:
To add more meaning into your culture, make sure that any intrinsic motivators are:
Above all else, make sure your high performers can answer the question, “Why is it worth it to be here and do what it takes to perform at a high level?”
The Bottom Line
Rewarding the behaviors that are in sync with your corporate culture and business strategy can make a huge difference. Setting the right talent management strategy to attract, develop, engage and retain top talent accounts for 29% of the difference between high and low performing organizations.
Is the way you reward high performers helping to create higher levels of performance and engagement?
To learn more about creating a high performance culture, download The Steps to Create a High Performance Culture that Thrives
A Meaningful Company Mission Matters
Hyperion has a commitment to lifelong learning. LSA helps us provide the right business sales training, management training programs, and leadership development programs at the right time to meet the needs of both individuals and departments. I especially appreciate their ability to listen to my needs and recommend the appropriate facilitators, solutions and content.
Senior Project Manager
VNUS Medical has been very pleased with the effective management development programs that LSA Global has delivered for us over the last four years. The programs have been universally facilitated by experienced and best in class instructors. The knowledge gained by our management team has been put into practice very quickly. VNUS is very happy to be working in partnership with LSA because they consistently deliver excellent programs that receive exceptional feedback from our management team.
Cindee Van Vleck
Director Human Resources
LSA custom designed a Management Development program that is absolutely “on target” for our technical managers. Their facilitator has done a superb job delivering the material in a way that is fast paced, highly interactive, and fun. She presents practical solutions to the people situations that our managers face every day. I regard LSA as an excellent partner that understands our business needs and a virtual member of our HR department.
Vice President Human Resources
We recently partnered with LSA Global to offer our Supervisors and Managers a customized two-day management training program. Everyone who attended said it was by far the best management training program they had ever attended. The content was rich and highly interactive. The case studies were relevant. Each participant walked away from the training much better equipped to lead their teams.
Director of Human Resources
LSA’s consultant designed and delivered a half-day team building solution for our recent conference. It included careful customization to integrate the design with our new mission and values. Everyone had fun and identified key issues with our teamwork. Altogether a great program!
Director of HR
SeaTel has found our partnership with LSA Global to be very valuable and beneficial. We turned to LSA to customize a supervisory/leadership solution to meet our needs. LSA delivered a customized top quality solution. I’d recommend LSA Global to any company looking for a best-in-class training and consulting partner.
Over the years, both at 3Com and now at Redback, I’ve found LSA Global to be a valuable resource. The recent compliance program that they delivered for Redback’s executive and management team was the right solution, of the highest of quality, and customized to our business and culture. I would highly recommend LSA to any company looking for top quality solutions.
Vice President of Human Resources
I continue to be impressed by the level of leadership development and management expertise and quality of advice and facilitation that LSA has to offer. What a smart and client-centric group of great people who really know how to help leaders attract, engage, develop and retain top talent.
Director, HR Business Partner
Congratulations on your pro-activity in establishing this program and developing such an effective New Employee Orientation course.
President and Chief Executive Office
The Managing Virtual Teams program was extremely valuable. Your consultant/ facilitator’s fundamental knowledge of Synopsys as a company provided an incredible base to build upon while tackling the complications of managing and working with globally distributed teams. My team walked away walked away with highly useful practices and tools. It was an excellent use of our time.
Vice President, Information Technology
I consistently look to LSA Global when I need custom programs put together for my client groups. I can always count on LSA to do a thorough needs analysis and to put together spectacular programs that are well received. Their management development and performance management expertise and professionalism make them one of my top-rated learning and development partners.
HR Program Manager
LSA’s approach and ability to bring the best resources to eBay has been a great asset. They really focus on helping us succeed in any way they can and are very flexible in meeting our management and talent needs.
Learning & Development
I am very impressed with the quality of work and talent. LSA did a great job of listening to my needs and providing the exact management training program expertise I needed to get the job done.
Director, Business Planning & Analysis
In the Next Generation Management Development courses, I was trained with skills and tools that have made me and my team more productive, motivated, and successful at communicating with other departments.
Firmware Engineering Supervisor
LSA has become the gold standard in team building and management training at Genomic Health! I have a hard time finding facilitators that come close to their level of customization, expertise and experience.
Director of Human Resources
Download key published insights and tools from industry experts highlighting best practices in the areas of talent, strategy and culture.
Want to know how you stack up against leading organizations? Receive a complimentary benchmarking analysis courtesy of an LSA Expert.
Get up to speed on timely solutions critical to your business. Published by LSA Experts based upon client feedback and key industry trends.
First we identify the key metrics you want to improve. Then we assemble a dedicated team of elite experts who have successfully solved similar problems with similar clients.
Stay up to do date with the latest information on how we help high growth companies align their culture and talent with strategy.
Real world consulting and training approaches from LSA projects, providing insights on how your company can outperform the competition.