Lucky is the Indian company that doesn’t have a hard time retaining talent these days. In the face of skyrocketing salaries, multinational entrants and sheer growth, employees seem to be playing chess with their careers. Human resources managers teeter between being fed up and innovative, installing gyms, raising pay and scheduling parties to keep employees happy.
Here’s a thought: Why not just tell those same in-demand workers they’re doing a great job? And then show them, with simple gestures from laudatory emails to movie passes?
That’s the message of The Carrot Principle: How the Best Managers Use Recognition to Engage Their People, Retain Talent and Accelerate Performance . Drawing on real-life examples from 1839 and the discovery of Goodyear tyres to the modern-day woes of companies such as Disney and DHL International Ltd, the book serves as a primer for managers attempting to keep employee morale up, and workplaces productive and harmonious.
Its title theory is somewhat self-explanatory: Dangle a carrot in front of employees and they will deliver. Such reinforcement, the authors maintain, is the catalyst that can help companies go from being almost great to great, near perfect to perfect. In business-speak, the carrot is known as an accelerant. “…an accelerant is the missing ingredient that will bridge the gap between where your team is now and where it can be. And in the workplace, there is no accelerant with more impact than purpose-based recognition,” the authors write in their introduction.
The book’s data rely on a vast survey of 2,00,000 managers and workers over a decade and smaller focus groups with some of them. Of those who reported the highest morale at work, almost 95% said their managers were effective at recognition.
The authors describe turnover and attrition with terms usually associated with pandemics. And like a doctor might say about illnesses and disease, prevention is the best medicine of all. Corporate turnover is said to be “the most significant uncalculated cost”, according to the authors, with one estimate saying that just a 5% increase in company loyalty can increase profits by 50%. Another estimate says that replacing a departing employee might cost up to 250% of that person’s salary.
So what’s the cure?
Besides hammering away at the idea of recognizing and rewarding employees and their good work, the book also lays out four basic principles of good leadership and management: goal setting, communication, trust and accountability.
Before the sections on rewarding employees, the authors spend several chapters outlining these fundamentals of management. Employers, they conclude, don’t really know what employees want. And employees, too, are often unable to articulate their organization and its top leadership’s mission. Mission is a word that keeps coming up throughout the book’s 200 pages—and authors advise treating it like a verb and not a noun.
While the examples throughout The Carrot Principle are taken from Corporate America, Indian companies and the Indian offices of multinational companies will recognize many of their dilemmas throughout. Those workplaces with youthful, say, between the ages of 22 and 30, employees might find the tips more relative, as well as companies specializing in business process outsourcing or sales.
The book’s final pages span 125 recognition ideas, from planning a celebration for a new hire’s first day to printing coupons for free cookies in the canteen, to asking supervisors to give the employee a round of applause. While some of the carrots described border on the bizarre and immature, the ideas are well-intentioned.
Managers reading the advice might not find themselves keeping a Recognition Frequency Log (that’s a book where you write down the names of your direct reports and keep track of the number of times you recognize them), but perhaps next time, they will remember to send an email and cc the Big Boss in appreciation of good work.
Cited multiple times in the book, the legendary Jack Welch, retired chief executive of General Electric, says companies are responsible for constantly devising different ways to engage the minds of employees.
He asks: “If you’re not thinking all the time about making every person more valuable, you don’t have a chance. What is the alternative? Wasted minds? Uninvolved people? A labour force that’s angry or bored?”
Already, some sectors in this hopscotch economy are showing the symptoms.Managers might do well to throw some carrots their workers’ way before they jump ship—or cause it to sink.