Tuesday, March 31, 2009

Read Roy Saunderson in the Boston Herald

Hello Folks!

My colleague Roy Saunderson from the Recognition Management Institute wrote an interesting opinion piece in the Boston Herald about his take on Senator John Kerry’s planned TARP Taxpayer Protection and Corporate Responsibility Act. Click on through and let me know what you think!

Monday, March 30, 2009

Even More Thanks but No Thanks

Friday, March 27, 2009

A Little Help From Your Friends

As mentioned in my previous post, David Zinger’s Employee Engagement Network is a great place to learn about employee engagement.

David’s created the network January 26th, 2008 and now, after one year, it boasts over 750 members from all over the world.

Over the last several months there have been a number of employee recognition posts to the network which is only logical when you consider how important recognition is to engagement. As a consequence, I've started an Employee Recognition discussion group.

I encourage all those with an interest and passion for Employee Recognition to join.

We should also give David Zinger a virtual round of applause for creating the network and giving us forum to share our views!

Monday, March 23, 2009

More Help From Your Friends!

Readers who are interested in learning more about engagement strategies and tactics should join David Zinger’s Employee Engagement Network at http://employeeengagement.ning.com

The network has over 1000 members and is a great source of information.

Some of the groups you can join include:

• Manager Tools for Employee Engagement
• Employee Engagement Research
• Employee Engagement Writers
• Engaging Books
• Engaging Films
• Engaging Quotations

There are also regional groups if you’re interested.

There is even a Corporate Yogi Group of members interested on how the role of meditation and yoga based tools effect employee performance and engagement!

I joined in 2008 and have enjoyed following the various discussions and David Zinger should be commended for putting this together!

Friday, March 20, 2009

AIG, Cash and Retention Bonuses

There are some very interesting lessons to be learned from AIG’s recent payment of employee bonuses.

Here’s the story… AIG received $170 billion in federal government bailout funds. To date they have paid 73 employees bonuses of more than $1 million each. One person was paid $6.4 million. Seven other people received more than $4 million each! According to the Attorney General of New York, 11 of these employees no longer work for the company! And the company wants to pay out more… for a total of $165 million!

The company stated they were obliged to pay out these bonuses for a number of reasons.

1. They needed to keep “talented” executives on the payroll.
2. These were “prior” contractual agreements in place that could not be broken.
3. These people crafted the terribly complicated derivative trades and are needed to unwind them.

The payments are being called “retention bonuses.” In my opinion it’s more like “retention madness!” However they do provide some valuable business and recognition lessons!

First, spare me with the keeping the talent argument! These people are losers and should be fired. It reminds me of the losing baseball team whose star player held out for more money one year and the manager said, "We finished last with you. We can finish last without you!"

Secondly, if AIG had not received any bailout money these bonuses would never have been paid out. The company would be bankrupt. The government should have set stricter terms as a condition for their bailout money.

Thirdly, to argue these are the only people who can figure out how to unravel this mess is specious at best and puts us at the mercy of a band of incompetents. One of the lessons I’ve learned managing Rideau is that nobody is irreplaceable! AIG would be better off having someone with a conscience working on their behalf.

These payments are nothing but greed and arrogance. Greed for more money and arrogance for thinking the rest of the world would let them get away with it.

Calling these payments “retention” bonuses is particularly insulting to those of us who work in the recognition and reward business. We work very hard implementing recognition programs that do retain employees. Any true recognition professional will tell you that cash alone is not effective as a retention tool. It creates what I call “employee mercenaries.” People who are only there for the money. People who have no loyalty to their company or the customers they serve.

AIG proves my point. Of the 73 individuals who have received so called “retention” money, 11 have already left the company!

No, what AIG needs today are “employee patriots.”

People who go above and beyond.

People who have a conscience and care about what they do.

People who care about their customers.

Monday, March 16, 2009


I sit on Recognition Professionals International’s Board of Directors and I’m going to engage you readers in a little shameless conference promotion!

We have some great things going on at this year’s RPI conference in Naples Florida on May 3rd to the 6th. The conference will be a great opportunity to collect tools and techniques that you can readily apply at work in this down economy. I urge you to register and take advantage of the following great savings:
  • Register for the conference now and pay the member rate of only $575
  • Enjoy the reduced room rate of just $179 per night ($20 Hotel Resort fee also waived)
  • Get one free room night at the Naples Grande (excluding taxes) when you sign up for at least one CRP course on site and register for the conference
  • Purchase an Exhibit Booth at the conference and get on free room night at the Naples Grande (excluding taxes)!
Further, RPI is offering online courses for CRP certification. You can now take the CRP I online at the one-time member rate of only $450 (until April 15) then finish up at the ’09 Sharing Conference. For more information on the conference please CLICK HERE.

Monday, March 9, 2009

Spend to End the Recession

A few weeks ago, I attended a small luncheon hosted by the President of one of Canada's largest bank.

He gave an overview of the economic crisis and I learned a lot.

The United States accounts for about 20% of the world's Gross Domestic Product (see CIA’s World Factbook for US and World) and the US consumer accounts for over 70% of this amount. This means US consumers account for a staggering 14% of the world's economy.

He also said that in the past, consumers led us out of recessions but this one is different. Consumers are hurting and economists believe government and corporations are our best hope for a quick end to this painful crisis.

Corporations need to start spending money again. But they need to spend money wisely... not on gazillion dollar bonuses to a select few but on things that matter.

Wells Fargo cut out all their recognition and reward programs. They did this to be politically correct. However their CEO publicly mourned their loss of these programs and commented on how important recognition and rewards are in today’s economy through an open letter in major US newspapers. (Click here to read Roy Saunderson’s, my friend and colleague's response to the Wells Fargo’s letter.)

I agree. Spending money on recognition and rewards is a wise investment.

But I also feel that a distinction must be made between rewards and recognition. Rewards cost money... if you need to cut costs, reduce your spend on them.

However, recognition is free. The only thing you need to spend is time. Never stop spending time recognizing your people!

Wednesday, March 4, 2009

Monday, March 2, 2009

Cut Salaries ~ Build Loyalty

Times are tough and it’s hard to escape bad news… everyday people are losing their jobs. According to the US Bureau of Labor Statistics over the past 12 months, the number of un-employed persons has increased by 4.1 million and the unemployment rate has risen by 2.7%!

According to a Watson Wyatt survey of almost 250 companies done in October 2008, 26% of US employers expect to make layoffs in the next 12 months. Other respondents said they would have hiring freezes and undertake company-wide restructuring (whatever that means). The survey indicated that 12% would have salary freezes and 4% would have salary reductions.

Clearly, in a business downturn, the easiest way for companies to reduce costs is to cut jobs. And I realize in certain circumstances there is no choice. When sales just aren’t there it is difficult to justify keeping people employed.

But I think layoffs should be the very last resort. In my opinion, everything should be done to preserve jobs by implementing salary freezes and salary reductions. It is easy to let people go. It is much harder to cut salaries.

I speak from experience… Rideau has grown over 30% annually for the last ten years. Our biggest challenge over the years has been balancing revenue growth with infrastructure growth. If you have revenue growth without the supporting infrastructure you have dissatisfied clients. Conversely, too much infrastructure results in poor financial results. At Rideau, we decided long ago that we would always err on the side of too much infrastructure. Twice this resulted in some hardship. Once in the early 90s the other in 2001. During these times, we met with our employees and explained the situation. We laid out our options… cut people or cut salaries. Both times we ended up cutting salaries.

Although my opinion clearly puts me in the minority, others are starting to look at this option as well…

According to the London Times Online 25,000 steel-workers at the steelmaker Corus offered to take a 10% pay cut to avoid the closure of a plant employing 1,000 people. Another company JCB, employs 4,000 workers and they voted to work fewer hours, which resulted in saving 350 jobs. In December, Japanese automaker Honda slashed its profit forecast for the fiscal year and announced that managers will take a 10% pay cut effective January 2009 but there will be no job cuts for full time workers.

I believe these companies will find out what Rideau did when we had salary cutbacks… Our employees appreciated and understood the situation. They supported the fact that we were trying to save and look to the future and save jobs.

And do you know what? Rideau benefited by having more loyal and productive employees who realized we were working as a team.

So I say in hard times, don’t cut jobs… cut salaries and build loyalty!