U.S. Office of Personnel Management - Ensuring the Federal Government has an effective civilian workforce

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Attracting, Retaining, and Rewarding Top Performers

Presentations by Jay R. Schuster, Ph.D., a partner with Schuster-Zingheim, Inc., of Los Angeles, California, and Maggi Coil, a partner with the Center for Workforce Effectiveness, of Chicago, Illinois, highlighted two 1999 Strategic Compensation Conference plenary sessions. Both speakers are highly respected private sector compensation and human resources authorities and shared their perspectives about compensation with participants.

• Total Rewards for the New Millennium.
• The Duality of the Compensation Contract.

Total Rewards for the New Millennium. Dr. Schuster highlighted the characteristics of the evolving workforce deal. According to Dr. Schuster, the old deal was characterized by paternalism and career employment, and was balanced toward the workforce. The new workforce deal is characterized by tough love and employability, and is balanced toward the organization. Dr. Schuster suggests that the better workforce deal for the year 2000 and beyond should be characterized by mutual accountability, win-win partnerships, and an equal balance between the workforce and the organization.

Dr. Schuster shared the following six reward principles for the new workforce deal:

• Create a positive and natural reward experience. Supervisors should create work climates where good performance is genuinely appreciated and recognized.
• Align rewards with business goals to create a win-win partnership. To create a win-win partnership, the organization and the employee need to gain from their relationship. Employees must continue to add value, and the organization must acknowledge their value with rewards.
• Extend peoples' line of sight. Employees should get information so they can see how they influence the organization's results.
• Integrate rewards. Incorporate base pay, variable pay (i.e., awards), and benefits into the total design of compensation.
• Reward individuals' ongoing value with base pay. This requires using base pay to reward individuals for the skills and competencies needed by the organization and used to generate results.
• Reward results with variable pay. Dr. Schuster recommends using variable pay programs, such as recognition or group incentive programs, to reward results because they are agile, flexible, adaptable, responsive, and able to focus on key measures of success.

The Duality of the Compensation Contract. Maggi Coil discussed the duality of the compensation contract–what companies are offering employees, and what employees are seeking from their employers. Ms. Coil noted that companies most commonly offer the following as benefits:

• variable pay,
• opportunity to learn new skills,
• stock options,
• restructured benefit plans, and
• defined contribution pensions.

Employees, on the other hand, are most commonly seeking:

• scheduling flexibility,
• benefits portability,
• the latest and greatest technology,
• a respectful work environment,
• opportunities to "learn the latest," and
• a balance of work and family life.

According to Ms. Coil, some of the things that we can do within the Federal Government to attract and retain valuable employees include:

• promote the benefits plan,
• look for scheduling options,
• reinforce a learning environment,
• create an environment of engagement, and
• look outside of the Federal Government for more ideas.

She challenged us–the Federal Government–to "make work fun!"

Both speakers shared invaluable information regarding a variety of reward principles that tie into the total compensation philosophy. These reward principles help to create a work environment that sets the stage for employees to add value to the organization.

For additional information, please contact us by email or call us at 202-606-2720.

Originally published on October 1999.