Daniel Goleman, author of the best seller Emotional Intelligence, and co-developer of the Goleman EI online learning platform, is a regular contributor to Korn Ferry. His latest book, Altered Traits: Science Reveals How Meditation Changes Your Mind, Brain, and Body, is available now.
Jan. 1, 2021 might have brought a sense of relief—if only because the turn of the year is traditionally imbued with hope.
But regrettably, when people return to work this year, they may be met by some disappointing news. In Korn Ferry’s 2021 Global Salary Survey, 16% of organizations polled said they aren’t planning on increasing employee salaries in the coming year—three times as many as withheld raises in 2020. And of the organizations giving raises, most will give out less money to fewer people. Only one third of those giving out raises said that pay increases will go to 100% of their workforce.
Scarcity—a pervading theme of 2020—hasn’t gone away with a turn of the calendar. Indeed, now that the holiday cheer has quieted, more small businesses have closed, and many cities are back in lockdown, some might say the feeling of scarcity is more prevalent than ever.
So, where’s the hope? If organizations can’t attract and retain people with raises this year, where might they focus instead?
Here’s a resolution: Make work more meaningful.
According to Korn Ferry, while financial rewards are key to attracting talent, it’s the non-financial incentives that make the biggest difference for retention. “Clear career paths and development opportunities are typically cited among the top things employees want most from their employers,” says Tom McMullen, a Korn Ferry senior client partner and a leader in the firm’s Total Rewards practice.
This data brings to mind a recent piece on mission statements: In a recent survey, close to one in four professionals said they would be willing to take a pay cut in order to work for a company whose mission and values they believe in.
Now is the time to think beyond the bottom line. As companies pivot and innovate to meet the emerging needs of the future, they are given the opportunity to think deeper about their reason for being while doing more to leverage the creativity and brain power of their workforce.
In another recent survey, 79% of business leaders said they believe that purpose is central to an organization’s success and longevity, but only 34% agree that it guides their decision-making.
As leaders ponder scenario planning, calculate risks, and come up with ways to keep costs down, they will be wise to ask what might they give that goes beyond a paycheck. Is it time off? A new role? A new project? A clearer line of sight from the front line to the organization’s values?
As Don Lowman, a Korn Ferry senior client partner and leader of the global total rewards, reminds us, “Non-cash rewards matter now more than ever.”
When we look back at 2020, we see some stunning examples of companies who took a risk to stand by their values, reimagine their work, and engage their employees in charting an effective path forward.
We can’t expect 2021 to be all roses. That’s not how reality works.
But we can put forth an intention: that 2021 is the year purpose will be embraced. The year purpose will guide decisions, inspire new development opportunities, bolster resilience, and help companies flourish so they can offer more generous compensation in the years to come.
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