How does reducing your wage bill but increasing employee commitment and productivity sound? Too good to be true?
As business leaders/owners we are all fully aware of the adage, “You are only as good as your team.” Our team’s ability to perform consistently at the levels we desire are critical to our business’s long-term success. Recruiting the right people is a very arduous and, at times, expensive task: we have to kiss a lot of frogs to find blue blood. Frustratingly, over 80% of recruitment is due to employee attrition, driven by employees finding an alternative job. In other words, we would spend 80% less on recruitment if our team members stayed.
Did you know: businesses are investing over five times more in recruitment and performance management than in colleague reward programs?
If a high-performing team member,(who fits your culture) hands in their notice, have you immediately looked to increase their salary to keep them?
If so, question one: why was it their resignation that reaped their reward? Question two: as their employer, why did you look solely at salary when considering reward? A team member’s commitment isn’t solely down to salary; there are lots of other factors which, when taken into account and acted on, can increase commitment and consistent performance in employees.
Businesses can spend less capital than expected and see lower attrition and higher commitment. A higher-committed colleague is nine times less likely to apply for a new role in a different business, than one who feels undervalued. Afterall, updating a CV, registering for job sites and spending time applying for roles, is very “my time” consuming.
A universally-recognised employee commitment measure used across SMEs, focuses on two areas: Engagement and Enablement. It simply measures the levers available specifically to an organisation to understand colleague commitment and whether they have the right tools to complete their role, and is usually visualised in a four-box grid – example below:
How would you rate your overall team and individuals based on the above? How would your team rate your business?
The more fun, recognition, benefits and development, alongside equipment, facilities and communication received, the more engaged and enabled employees are, which increases Engagement and Enablement.
As business owners, I hope you are experiencing a boom since the recent pandemic. Not since the end of WWII, have we experienced anything like the last 24 months and, with the job market now thriving, keeping our best people has to be a P1 – business critical.
More than ever, now is the time to invest in our employees.
The ONS (Office of National Statistics) published an article on the 13th of September 2021, detailing household spending during the pandemic. The article explained that household spending reduced on average by 19%, which amounted to £109 over ………
The report detailed household spending and earnings across all social groups. Around a third of workers saw their incomes fall during the pandemic. Interestingly, but not surprisingly, workers classed as “lowest income earners”, saw their earnings fall up to 42%. The group comprises of 20% of the UK workforce. To put it simply, one in five people had earnings significantly reduced through the pandemic and 28% of people reported they were finding it difficult to make ends meet.
If we transfer these stats into the standard business pyramid, we can safely say there will be more employees working for SMEs finding it difficult to make ends meet, than those not. The lowest income earners have minimal expenditure to reduce; high earners saved on transport, restaurants and recreation, of which minimally impacted lower earners.
We are seeing more and more small businesses supporting their employees in different ways, be it travel – cycle to work schemes, bus passes, free parking – or employee discounts, all of which increase Engagement. However, with the relevant tax breaks, the investment is less than a simple pay rise.
Communication is one of the largest monthly costs an average family incurs. When you include home broadband and mobile phones, including SIMs, the average monthly home communication bill is over £110.
By offering employees a work mobile phone package and home broadband (which in total is a small cost to your business), this will have substantial impact on your employees’ monthly expenditures. Not only can they spend this money elsewhere, but every time they make a call, send a text or watch Netflix, they will be grateful to the business they work for, which will add valuable engagement and an increase in commitment, far more than a simple pay rise.
More and more businesses are showing commitment to their employees by recognising the need to support their communication needs, and more and more businesses need to act now, more than ever before, to keep their prized assets – their employees.
At Vodafone Somerset, we offer business customers 10% of their first line’s monthly line rental and 15% off all additional lines, with home broadband starting from £19.50 a month.
We can visit you at a date and time convenient to you and explain further the benefits of Vodafone to you and your teams.