When employees are paid well, they perform well. Clearly, when they perform well, the company performs well too! According to a survey conducted, the performance of a company depends on how well the company is paying its employees. The bonuses, incentives, perks, and salaries are the obvious motivating factors for an employee to put in more effort.
Another survey revealed that 90 % of the top-performing firms give pay raises. The rest 84% average companies also gave pay raises. However, 81% of the top performing companies give bonuses but 74% of average ones didn’t.
You may be wondering if the companies are more generous or is it that when paid better, employees start working more assiduously.
As per strauss, how an employer thinks of its employees speak a lot in this regard. Out of all the top performing companies, 86% claimed their employees as their greatest asset while 76% of average companies said the same when asked the same question.
This is what is called Good Jobs Strategy, the performance and compensation are linked to each other, the better you pay, the better they perform. However, it is not just limited to that, it also is a result of smarter management.
In order to make your good jobs strategy successful, you must have good management in place. Right execution is the key. Not just the pay but restructuring the work for each employee also matters a lot if companies want to increase productivity.
Being transparent with your employees is another thing that matters. Even the payroll software for small businesses have this provision. However, when asked 73% of employers said they pay their workers appropriately but only 36% of employees agreed to it.
To this some employers argue that payroll software for small businesses and enterprises take the data from biometric attendance software, they see the analytics as well and give the best and right pay according to the market.
But the disagreement is still there and that is because of no or poor communication. It is advisable to the employers to be transparent and tell employees about what they are paid and why. You can share the compensation strategy you use, talk about their performance or share the mechanics.
For proper performance review, employers can use a comprehensive HR software that doesn’t just have payroll software for small business and enterprises but also has performance management software. The benchmarks can be set and the compensation or incentive for each target achievement should be set as well.
In short, it is really important to value your employee and take steps to solve their concerns. This will help you in forming a great bond of trust and respect. Both of them are a powerful tool for the purpose of engagement and to take your business to new heights.