with Bob Nelson, Ph.D. Sponsored by Maritz, Inc. July 28, 2009 Best Practice Institute Keeping Up in a Down Economy: What the Best Companies Do to Get Results in Tough Times presents with Bob Nelson, Ph.D. Sponsored by Maritz, Inc. The Leader in Employee Rewards July 28, 2009

Your Presenter Bob Nelson, Ph.D. President, Nelson Motivation Inc. Co-Founder, Recognition Professionals International NYT/WSJ Best-selling Author

Bob Nelson

Recent Research

Recent Research What Most Distinguishes High Engagement Workplaces from Low Engagement Workplaces During Recessionary Times?

Recent Research What Most Distinguishes High Engagement Workplaces from Low Engagement Workplaces During Recessionary Times? Source: Research from 5,000 companies conducted by Quantum Workplace (n = 1.5 million employees)

Recent Research What Most Distinguishes High Engagement Workplaces from Low Engagement Workplaces During Recessionary Times? A Clear & Compelling Direction Source: Research from 5,000 companies conducted by Quantum Workplace (n = 1.5 million employees)

Recent Research What Most Distinguishes High Engagement Workplaces from Low Engagement Workplaces During Recessionary Times? A Clear & Compelling Direction Open & Honest Communication Source: Research from 5,000 companies conducted by Quantum Workplace (n = 1.5 million employees)

Recent Research What Most Distinguishes High Engagement Workplaces from Low Engagement Workplaces During Recessionary Times? A Clear & Compelling Direction Open & Honest Communication Continued Focus on Career Growth & Development Source: Research from 5,000 companies conducted by Quantum Workplace (n = 1.5 million employees)

Recent Research What Most Distinguishes High Engagement Workplaces from Low Engagement Workplaces During Recessionary Times? A Clear & Compelling Direction Open & Honest Communication Continued Focus on Career Growth & Development Recognizing & Rewarding High Performance Source: Research from 5,000 companies conducted by Quantum Workplace (n = 1.5 million employees)

Recent Research What Most Distinguishes High Engagement Workplaces from Low Engagement Workplaces During Recessionary Times? A Clear & Compelling Direction Open & Honest Communication Continued Focus on Career Growth & Development Recognizing & Rewarding High Performance Employee Benefits that Support Well Being Source: Research from 5,000 companies conducted by Quantum Workplace (n = 1.5 million employees)

Stress = Excitement

Acknowledging and Appreciating People for Their Achievements Recognition = Energy Acknowledging and Appreciating People for Their Achievements 13

You Get What You Reward When You Get Serious About Performance You Have to Get Serious About Recognition

of a Recognition Culture Employee Value of a Recognition Culture

5 times more likely to feel valued Employee Value of a Recognition Culture 5 times more likely to feel valued

of a Recognition Culture Employee Value of a Recognition Culture 5 times more likely to feel valued 7 times more likely to stay with the company

of a Recognition Culture Employee Value of a Recognition Culture 5 times more likely to feel valued 7 times more likely to stay with the company 6 times more likely to invest in the company

of a Recognition Culture Employee Value of a Recognition Culture 5 times more likely to feel valued 7 times more likely to stay with the company 6 times more likely to invest in the company 11 times more likely to feel completely committed —Maritz Poll, 2007

A Strategic Imperative Recognition: A Strategic Imperative Because Organizational, Cultural and Financial benefits are realized through positive employee recognition and effectively engaging your entire workforce

How to Keep Employees Excited and Committed in Tough Times? The Challenge How to Keep Employees Excited and Committed in Tough Times?

Source: Towers Perrin Engagement Research, 2008 Committed Employees Deliver 57% More Effort Than Uncommitted Ones Source: Towers Perrin Engagement Research, 2008

6 Key Strategies to Use During Tough Times 23

6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus 24

All Performance Starts with Clear Goals and Expectations

Refine Your Focus During Tough Times Groups: Ask “What are the most important things we should be focusing on at this time?”

Refine Your Focus During Tough Times Groups: Ask “What are the most important things we should be focusing on at this time?” Individuals: Ask “What can you do in your job that can most help us right now?”

Example Home Depot has cut jobs and closed 15 locations. They reset more realistic goals by lowering sales and profit targets that hourly employees need to achieve to receive bonuses.

Example Home Depot has cut jobs and closed 15 locations. They reset more realistic goals by lowering sales and profit targets that hourly employees need to achieve to receive bonuses. Result: The highest percentage ever of in-store employees got bonuses in the first half of 2008.

Source: Based on post-doctoral research by Dr. Bob Nelson 6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication Source: Based on post-doctoral research by Dr. Bob Nelson 30

Source: Based on post-doctoral research by Dr. Bob Nelson 6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication **Manager provides employee information he/she needs 95% Source: Based on post-doctoral research by Dr. Bob Nelson 31

Source: Based on post-doctoral research by Dr. Bob Nelson 6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication **Manager provides employee information he/she needs 95% **Manager asks employee for opinions or ideas 92% Source: Based on post-doctoral research by Dr. Bob Nelson 32

Source: Based on post-doctoral research by Dr. Bob Nelson 6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication **Manager provides employee information he/she needs 95% **Manager asks employee for opinions or ideas 92% **Manager involves employee with decision-making 89% Source: Based on post-doctoral research by Dr. Bob Nelson 33

Source: Based on post-doctoral research by Dr. Bob Nelson 6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication **Manager provides employee information he/she needs 95% **Manager asks employee for opinions or ideas 92% **Manager involves employee with decision-making 89% **Manager supports employee when he/she makes a mistake 94% Source: Based on post-doctoral research by Dr. Bob Nelson 34

“You can tell a lot about the long-term viability of any organization simply by looking at how it handles mistakes.” — Bill Gates Former Chairman Microsoft Corporation

Communication Strategies For Tough Times Groups: Town hall meetings, CEO breakfasts, brown bag lunches, idea boards; being open and honest in explaining the situation and challenges going forward

Communication Strategies For Tough Times Groups: Town hall meetings, CEO breakfasts, brown bag lunches, idea boards; being open and honest in explaining the situation and challenges going forward Individuals: Personal support and “face time,” especially for those doing desired behavior, achieving desired results

6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication #3 Involvement and Initiative 38

To maximize buy-in and motivation, challenge people for ways to improve.

Guidelines for Involvement Identify key influencers Let teams do the problem solving Make it a conversation Follow through Source: www.bnet.com 40

most frustrated employees Example Texas Commerce Bank held focus groups with employees to determine what procedures most frustrated employees and customers.

most frustrated employees Example Texas Commerce Bank held focus groups with employees to determine what procedures most frustrated employees and customers. Result: Using the feedback, the company nearly doubled its $50 million cost-savings goal.

Example Amid severe cutbacks, Best Buy has set up online surveys to solicit ideas from its employees for cutting costs.

Example Amid severe cutbacks, Best Buy has set up online surveys to solicit ideas from its employees for cutting costs. Result: Some 900 ideas were submitted in just the first 3 weeks, which have led to significant cost savings.

6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication #3 Involvement and Initiative #4 Autonomy and Flexibility 45

Work is becoming a state of mind more than a place to be.

Autonomy Strategies For Tough Times Groups: Allow groups to organize around problems and opportunities the organization faces

Autonomy Strategies For Tough Times Groups: Allow groups to organize around problems and opportunities the organization faces Individuals: Allow individuals flexibility, where possible, in their schedules & working hours

Example Sun Microsystems allows employees to telecommute when possible as their work permits it.

Example Sun Microsystems allows employees to telecommute when possible as their work permits it. Result: Those employees who averaged 2.5 days at home each week saved $1700 a year in gas and vehicle wear-and-tear.

6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication #3 Involvement and Initiative #4 Autonomy and Flexibility #5 Learning and Development 51

Ninety percent of all development occurs on the job.

Development Strategies For Tough Times Groups: Know people’s strengths and interests, evaluate group needs and opportunities; constantly be training

Example During the recession of 2001-2003, Toyota shut down a plant for 10 months, but kept all employees and trained them.

Example During the recession of 2001-2003, Toyota shut down a plant for 10 months, but kept all employees and trained them. Result: Once it reopened, that plant had the highest global productivity and quality ratings, which helped secure a higher market share.

Development Strategies For Tough Times Groups: Know people’s strengths and interests, evaluate group needs and opportunities; constantly be training Individuals: Increase responsibilities and assign projects based on individual interests and abilities, especially for your most talented employees

Example American Express teaches its managers a delegation technique they call “Label and Link.”

Result: Employees better understand what is needed Example American Express teaches its managers a delegation technique they call “Label and Link.” Result: Employees better understand what is needed and are more motivated to do those things.

6 Key Strategies to Use During Tough Times #1 Revised Goals and Renewed Focus #2 Information and Communication #3 Involvement and Initiative #4 Autonomy and Flexibility #5 Learning and Development #6 Recognition and Praise 59

Source: Post-doctoral research conducted by Dr. Bob Nelson 99.4% of today’s employees expect to be recognized when they do good work Source: Post-doctoral research conducted by Dr. Bob Nelson

Few Employees Feel Recognized Today Only 12% of employees strongly agree that they were consistently recognized in ways that are important to them

Few Employees Feel Recognized Today Only 12% of employees strongly agree that they were consistently recognized in ways that are important to them Nearly three times as many (34%) disagree or strongly disagree that they are recognized in ways that are meaningful to them – Maritz Poll, 2006

All Behavior is a Function of its Consequences

Positive Consequences Negative Consequences No Consequences Three Types of Consequences Positive Consequences Negative Consequences No Consequences

Recognition and Rewards For Tough Times

Recognition and Rewards For Tough Times Groups: Celebrations, team-building activities, morale-building meetings, team awards and competitions

Recognition and Rewards For Tough Times Groups: Celebrations, team-building activities, morale-building meetings, team awards and competitions Individuals: One-on-One meetings, recognition activities, thanks and praise

Recognition and Rewards For Tough Times Low-end Rewards, e.g., e-cards for Starbucks, Amazon.com, gas cards, gift certificates, food

Recognition and Rewards For Tough Times Low-end Rewards, e.g., e-cards for Starbucks, Amazon.com, gas cards, gift certificates, food Symbolic Items, e.g., tokens, coins for vending machines, points for performance

Example Busch Gardens in Tampa, FL, supplies tokens to all supervisors to give to employees to reinforce core values. The tokens can be redeemed in their paycheck for $10.

Example Busch Gardens in Tampa, FL, supplies tokens to all supervisors to give to employees to reinforce core values. The tokens can be redeemed in their paycheck for $10. Result: Employees are more focused on desired behaviors that are rewarded and have fun in the process.

Recognition and Rewards For Tough Times Low-end Rewards, e.g., e-cards for Starbucks, Amazon.com, gas cards, gift certificates, food Symbolic Items, e.g., tokens, coins for vending machines, points for performance Employer Perks, e.g., soft drinks, bottled water, snacks, a celebration pizza, ice cream socials

Recognition and Rewards For Tough Times Low-end Rewards, e.g., e-cards for Starbucks, Amazon.com, gas cards, gift certificates, food Symbolic Items, e.g., tokens, coins for vending machines, points for performance Employer Perks, e.g., soft drinks, bottled water, snacks, a celebration pizza, ice cream socials Time-off Rewards, e.g., vouchers for time off, calling in well, schedule adjustments

Example Boston-based Greenough Communications started “Winter Fridays” in which high-performing employees are awarded by being able to leave at 3 pm on Friday.

Example Boston-based Greenough Communications started “Winter Fridays” in which high-performing employees are awarded by being able to leave at 3 pm on Friday. Result: Viable reward alternative to money for exceptional performance.

Example Los Angeles-based JS Communications recently gave employees two free “I Don’t Want to Get Out of Bed” days in the forthcoming year.

Example Los Angeles-based JS Communications recently gave employees two free “I Don’t Want to Get Out of Bed” days in the forthcoming year. Result: Employees love the benefit and consideration provided by the company.

Recognition and Rewards For Tough Times Low-end Rewards, e.g., e-cards for Starbucks, Amazon.com, gas cards, gift certificates, food Symbolic Items, e.g., tokens, coins for vending machines, points for performance Employer Perks, e.g., soft drinks, bottled water, snacks, a celebration pizza, ice cream socials Time-off Rewards, e.g., vouchers for time off, calling in well, schedule adjustments Constant Attention, e.g., checking in, asking questions, being accessible, sincere thanks

Personal and Public Praise Praise and Thanks Personal Written Electronic Public

Praising Individuals ASAP-Cubed Soon Sincere Specific Personal Positive Proactive

Praising Individuals I saw what you did I appreciate it Here’s why it’s important Here’s how it makes me feel

Praising Strategies Praise someone directly Praise them in front of others Praise them when they’re not around (i.e., positive gossip)

Common Elements of Key Strategies Key factors tend to be intangible Key factors tend to be interpersonal Key factors are all forms of recognition Conclusion: In challenging times, increase the personal aspects of managing. 83

Creating a Culture of Recognition A Best Practices Model Essential Elements Strategy and Commitment Communication and Branding Measurement and Tracking Improved Performance Desired Behaviors Rewards and Celebration Management Training Process Improvement

The Core Element: Management

Heads, Hands, Heart

Questions? Bob Nelson, Ph.D. bobrewards@aol.com (800)575-5521 www.nelson-motivation.com

Bob Nelson, Ph.D. bobrewards@aol.com (800)575-5521 www.nelson-motivation.com New Book: Keeping Up in a Down Economy Speaking & Consulting Services Resources, Articles and Assessments Best Product and Bulk Book Discounts Free Tip-of-the-Week Registration

If You Don’t Recognize the Performance that Most Matters, You Won’t Get the Results You Most Want

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