HUMAN RESOURCE MANAGEMENT

HRM 2324
CLASS 4: RETENTION & REWARDS

FILIPA ROCHA RODRIGUES

OCT 3 TH , 2023
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Retention & Rewards

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Retention & Rewards

Results from
Mentimeter
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Retention & Rewards

We may look for

different things
but there is a
pattern!
And: a good salary
and a good
culture are not
enough to
compensate for
the lack of career
opportunities (to
retain)
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Retention is about
fulfilling intrinsic and
extrinsic motivation
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Motivation
MOVED INTO ACTION

CURIOSITY,
PRESSURE
PASSION, …

“I want to …” “I have to…” or “ I need to…”

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Motivation
MOTIVATION WILL LAST LONGER

EXTRINSIC INTERNALIZED INTRINSIC

MOTIVATION MOTIVATION MOTIVATION

“I have to… otherwise I

“I need to…I have to do “I want to do
will be punished” or “ I
because I understand it…because I want
have to do it because I
the worth of that to learn more…I
will receive that reward
action” enjoy doing this.. I
…”
found that
meaningful”
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Intrinsic Motivation

A B C
AUTONOMY BELONGING COMPETENCE
• Endorse your own actions; you • Employees need to feel a sense • The need to feel effective and
decide what needs to be done of belonging, an emotional competent in the activities we
• People don't like to feel connection with the engage / perceive a sense of
coerced, they want to feel like organization and peers. “I growth
they're the self organizers of matter in this group”; “I
their action. contribute”
• Autonomy is not independence
/ is not freedom

* Based on the Self-Determination Theory

What factors can facilitate and
undermine?
A Delegate / Empower Micromanagement
AUTONOMY

B Support from the leader.

Internal communication
Mismatch with
culture
BELONGING

C Challenging tasks,
Feedback, Praise
Easy tasks
COMPETENCE
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The two-factor theory

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The Equity Theory

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The Equity Theory

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The 5 job-characteristics model

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Retention = Engagement
Factors: result from employees’
perceptions of…
Feel Feel Feel Feel Feel Feel
valued growing connected proud balanced safe
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Feel Feel Feel Feel Feel Feel

valued growing connected proud balanced safe

Respect Growth Belonging Meaning Work & Life Trust

Conciliation
§ Recognition § Career § Part of the team § Feel proud of the § Time for personal § Speak up
opportunities Build together work and the life Trust in
§ Compensation & §

company
§

package Training Time to recover leadership

§
§ Cooperation §

The work has an from work Feel heard

Coaching
§

§ Feedback §
§ Common goals impact… find
§

Flexibility …
Challenging
§

§ Opportunities §
§ Share information… purpose §

tasks / § …
…
projects
§

§ Learning
§ …
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7

When employees
feel valued by the
organization and
by leaders they
will give it back
(reciprocity)
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If we guarantee these
engagement factors, will all
employees feel engaged?

Feel Feel Feel Feel Feel Feel

valued growing connected proud balanced safe
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Employees’ Surveys to measure

engagement: results give you a
clear perspective of what is ok
and what is not
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Example: engagement survey

Engagement Recommendation as a Good Global Satisfaction Level
Level Place to Work for

Neither
Less Highly Strongly Agree Strongly Strongly Very Somewhat Somewhat Very Strongly
engaged Engaged Engaged
Disengaged Disagree Disagree Agree Agree Dissatisfied Dissatisfied Dissatisfied Satisfied Satisfied Satisfied
nor Disagree

5% 16% 37% 43% 2% 4% 23% 35% 36% 1% 1% 13% 32% 40% 12%

21% 80% 6% 71% 15% 84%

These 3 are
important
indicators of
future retention /
turnover
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Example of
1. I have autonomy to decide how my work 2,2% 9,1% 40% 48,4% 0,4%
should be done.

questions in
2. I know how my work impacts ABC’s 1,1% 4,4% 25,5% 68,7% 0,4%

performance.

an
3. I am recognized for the work that I do. 2,9% 17,5% 41,1% 37,8% 0,7%

engagement
4. The work that I do is meaningful. 1,5% 2,9% 23,6% 71,6% 0,4%

survey (1) 5. I feel proud of the work that I do. 1,8% 3,6% 30,5% 63,6% 0,4%

Some of the items relate to 6. I feel emotionally attached to this organization. 2,9% 11,6% 29,1% 56% 0,4%
the organization but others
to direct leadership. For
7. My voice is heard / My opinions seem to 3,3% 13,8% 46,2% 34,9% 1,8%
example, recognition can be
count.
either, but if the question is
about feedback, it reflects
the relationship with the
leader
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11. I receive frequent feedback about my performance.

Example of
6,2% 21,8% 38,2% 32,7% 1,1%

12. Here, I perceive future career opportunities.

questions in
10,9% 26,5% 38,2% 22,2% 0,7%

13. I'm clear on my career development

an
opportunities and what are the skills & 6,2 17,5% 42,2% 33,5% 0,4%

capabilities I need to develop to continue

growing.

engagement 26. My compensation is fair when compared with 14,5% 28,4% 35,3% 15,6% 6,2%

survey (2)
similar functions / roles in other organizations.

35. It is ok to take controlled risks at work and 3,6% 16,4% 39,6% 35,6% 4,7%
challenge the status quo at ABC.
Feel safe to give opinion if
pretty much relate to the 36. Frequently, I feel that I have the space to give 2,5% 15,6% 37,5% 43,3% 1,1%
my opinions in a honest way.
relationship with direct
leader
Challenge the status quo… in
a sector where innovation is
key!
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Extrinsic Motivation – Fixed

and Variable Pay
Would you
A opt for A or
Rewards
(Variable Pay) B?
B

L X H
Performance
*
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Pay to Performance

Pay average for average

High differentiation performance (not that
among high and difference between high
average and average
performers. performers).
Impact: low performers Impact: average
have an incentive to performers do not have
perform better. The an incentive to perform
ones who cannot better and will naturally
perform better will stay. High performers will
naturally leave leave
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A real
Weight Goal Reached

example
Organization (level 50% 50M€ 40M€
40/50*50%=40%
1)
+
from Senior Area (level 2) 30% 10M€ 8M€ 8/10*30%=24%

Manager in +

Consultancy
Team (level 3) 20% 1M€ 1M€ 100%*20%=20%

Variable
Pay

84%

0 80% 100% 120%

Performance
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Weight split among levels will dictate

competition vs collaboration
OPTION A OPTION B

Weight Weight

Organization (level 1) 50% 10%

Area (level 2) 30% 20%

Individual (level 3) 20% 60%

What are the

differences?
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Weight split will dictate competition vs

collaboration
Option A: more
collaboration;
OPTION A OPTION B Option B:
competition
Weight Weight
The higher in the
Organization (level 1) 50% 10%
hierarchy the
higher weight in
Area (level 2) 30% 20% level 1 … WHY?

Individual (level 3) 20% 60%

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Key takeaways
In order to enhance engagement, intrinsic and extrinsic motivators need to be considered. For example,
autonomy is relevant (intrinsic). Next class, we will discuss the real case of a Marketing Director, with more than 20
1
years of experience, who who would to have to check all the strategic decisions taken by her and her team with the
CEO...

2 Companies need to pay in accordance to performance .... Especially high performers, want to be compensated
for what they achieve (results)

3 Engagement level is a “leading indicator” of turnover .... And should be measured through employee surveys

4 Rewards will affect culture: more cooperation or more competition

 Thank you!
See you on Saturday!
Don’t miss it!
filipa.rodrigues@novasbe.pt