Rewarding Employees in Tough Budgetary Times

With funds for incentives tight or nonexistent, how can public CIOs recognize employees for going above and beyond?

by / November 11, 2011
Flickr/Quinn Dombrowski

Appreciation is a wonderful thing: It makes what is excellent in others belong to us as well,” said French philosopher Voltaire. Employers who know and exercise appreciation, have happy employees and successful businesses — but how it’s done differs in the private and public sectors. Laura Fucci’s former employer, the MGM Mirage hotel, staged an annual Employee of the Year event complete with a celebrity host. At her current workplace in Clark County, Nev., staff recognition is much more modest.

Traditional luncheons to celebrate five-year service milestones have fallen by the wayside, which leaves management with only certificates to hand to staff members, thanking them for their years of service. But Fucci, the county’s CIO, says that isn’t enough, so she also takes her employees to lunch.

“I don’t have funding from the government to do that,” Fucci said. “So I work it out with my budgeting manager — my husband.”

In an era of tight money, public CIOs often have to get creative to recognize employees for steady, good work or reward exceptional contributions. But many believe those rewards are essential — even if they must dig into their pockets to fund them or devise incentives that don’t require cash.

According to a May 2011 report published by WorldatWork, a nonprofit organization that focuses on HR issues, 77 percent of the public-sector organizations surveyed said they provide some kind of recognition for exceptional performance. Ninety-three percent said they give length-of-service awards; 30 percent recognize employees of the year, month or other period; and 27 percent use incentive programs to motivate specific behaviors.

Saying Thank You

Providing employee incentives is simply the right thing to do, said Adrian Gardner, CIO and head of the Information Technology and Communications Directorate (ITCD) at NASA’s Goddard Space Flight Center in Greenbelt, Md. “Especially in the difficult times in which the government and country find themselves today, I think it’s extremely important to say, ‘Thank you.’”

IT staff are always solving one problem and then moving on to the next, with barely a moment to acknowledge their accomplishments, Fucci said. “IT can very easily become a burnout job. It’s those moments you take to recognize people that make them feel worthwhile in what they do.” Employees who go unrecognized might seek better-paid jobs in the corporate world, she said.

“The public sector is ripe ground for IT poaching,” said Paul Rowson, managing director of WorldatWork. Even in a troubled economy, CIOs should coordinate with HR officials to offer incentives — cash-based or not — that make employees feel their jobs are worth the effort they put into them, he said.

Besides encouraging employee loyalty, incentive programs might help encourage innovation. As an example, Jim Sills, Delaware’s CIO, points to a program operated by his previous employer, MBNA America Bank (now Bank of America). When one employee offered a cost-cutting suggestion that the company successfully implemented, the employee took home 15 percent of the realized savings.

Corporations like Apple and Google use incentives to drive innovation, Sills said. “Why shouldn’t we in the public sector try to do the same thing?”

Sills awards certificates or writes thank-you notes to staff members for outstanding contributions. “But we don’t have anything with any teeth to it,” he said. “We’re not allowed to give days off from work; we’re not allowed to provide any financial incentives.”

Delaware’s Department of Technology and Information has some terrific employees, Sills said. “But my job as a leader is to try to get a little more out of them.” A pool of money devoted to employee incentives — if he could get one — would add an important item to his toolbox, he said.

Seed Money

Bill Rogers, CIO of New Hampshire and commissioner of the state’s Department of Information Technology (DoIT), also would like to set aside money to help spur innovation. He would draw upon this pool not only to make cash rewards, but also to finance implementations.

“In my past, I’ve been very successful at getting innovative ideas from people who deal every day with the service or product we’re delivering,” said Rogers, who came to the state CIO job earlier this year from the private sector. Back then, he could fund the best ideas and set low expectations for return on investment. Perhaps two out of 10 ideas would take off in a big way, Rogers said. The others usually turned out reasonably well.

At a global manufacturing firm where Rogers worked, for example, one employee proposed a way to deliver spoken information to blind people, who would use phones or other handheld devices to scan quick response (QR) codes. “We developed a ‘skunk works’ project, and today that QR code company is very successful as a subsidiary of the larger manufacturing company,” he said.

Rogers envisions using a similar strategy to jump-start creative IT initiatives for the state. “It would be more around how to provide better, cheaper, faster services to the citizens of New Hampshire.”

With the state budget under the knife, there’s no discretionary money to fund such a program, Rogers said. “But I’m still pushing. I’m looking for savings that no one thought of before,” he said. If he can eke out some money, he hopes to invest it in employees’ best ideas.

To tap employees’ brains today, Rogers runs roundtable sessions called “Bagels with Bill.” At each one, he sits down with a dozen members of the IT staff, randomly selected by the HR department, to discuss six questions: What do we do well? What do we do not so well? What should we start doing? What should we stop doing? What attracted you to public service? What would it take to get you to stay in public service?

DoIT also operates a program to recognize individuals for excellent performance and another for project teams. Those primarily involve peer-to-peer kudos and write-ups in the department newsletter, Rogers said. “Unfortunately the budget doesn’t allow me to give out bonuses or other rewards of that sort.”

To further encourage staff contributions, Rogers said he’s received approval from the personnel department for a new program he’s considering to reward employees who help to attract new talent to DoIT.

“I’m going to pay out of my pocket for people to recommend their associates or friends external to state government,” Rogers said. “If they’re hired and they last 30 days, I’ll give a gift card to the employee who made the referral and take that person, along with the new employee, to lunch.”

Carving it Out

Gardner is more fortunate than most: His management toolbox includes an employee recognition fund. But the fund exists, he said, because he carved out the money when developing his budget.

Some of the money goes to the ITCD’s peer-reward program, which recognizes agency staff and contract workers for outstanding achievements. During the daylong ceremony, the ITCD awards plaques and cash to the winners, who are nominated by their peers. “We have a luncheon and provide time for folks to get together and show their appreciation to the winners,” Gardner said.

Employees win awards for excellence in customer relationship management, technical achievement, leadership and other areas. At this year’s ceremony in July, for example, one winner was recognized for work on the procurement of a desktop management system. A group from the IT security organization won for helping various agency websites with accreditation and authorization.

Gardner also uses part of his budget to present Group CIO Awards, honoring teams that have made outstanding contributions over time or excelled in specific tasks. One recent award went to the communications team that supported NASA’s space shuttle throughout the life of the program.

Beyond cash, Gardner uses paid time off to reward certain achievements. He also sends thank-you notes for good work, and he singles out employees for praise at all-hands meetings. “We try to make a big deal about folks who have reached their 10, 20, 30 and especially 40-year anniversaries within the federal government,” he said.

Like Gardner, Fucci also can use time off to reward good work. “Every department is given so many incentive hours, and you can award them based on recognition,” she said. Fucci gets 103 hours per year to allocate to her staff.

“But I felt that I needed to do something above and beyond that to recognize exceptional work,” Fucci said. So she instituted the CIO Awards, bestowing two of them at each of her department’s quarterly all-hands meetings.

“They used to be plaques. Now they’re certificates — another cut,” Fucci laughed. The award also comes with a $50 Visa gift card. “Lately the awards have been going to teams rather than individuals, and they have been using the gift cards to go out for a celebratory lunch,” she said. Like the service award lunches, those gift cards come from Fucci’s own pocket.  

Food for Thought

In Montgomery County, Md., employee recognition is a constant theme in the Department of Technology Services. “I keep 1001 Ways to Reward Employees [by Bob Nelson] on my bookshelf at all times,” said Steve Emanuel, the county’s CIO.

Calories play a prominent role in Emanuel’s incentive toolbox. He regularly uses lunches, doughnuts, cookie trays and other edible indulgences to thank employees for excellent work. For instance, since the public ceremony to introduce the county’s new 311 system didn’t give a nod to the technical team, Emanuel threw a pizza party to thank that group for its accomplishments.

An employee at a major staff meeting who sticks up a hand to answer a question might walk out with a Starbucks gift card. And Emanuel keeps jars on his desk filled with Starbursts, Skittles and M&M’s, using them to lure staff members in for informal chats. “I tell them the goal is to have you not afraid to come into my office,” he said. “There’s a reward if you come in to say something and make sure I know who you are.”

Employees who share especially good ideas get a special perk: They get to choose what kind of candy goes into one of the jars. “They love that, because the leader of their organization is recognizing and capitulating to them,” Emanuel said.

Emanuel funds those employee incentives himself, to the tune of $2,000 to $3,000 a year. “It’s worth it, because then people are not afraid to step up and volunteer for things,” he said. “Not that they expect the reward. But they never know when it’s coming.”

Both Fucci and Emanuel contend that smaller, fun rewards — the kinds that don’t cost a fortune, such as gift cards, lunches and potluck picnics — often work better as incentives than cash bonuses do. “I think money is a short-term motivator,” Fucci said.  
Emanuel cites a survey conducted by Gartner in the early 1990s that showed that money isn’t the top employee motivator. “It’s training, it’s recognition, it’s pride of ownership, pride of work and, in some cases, the work environment,” he said.

Beyond cash, employers can call upon many other strategies to reward performance and make employees feel appreciated, said Rowson at WorldatWork. One key to choosing the right incentive is to find out what perks employees value most, he said. Employees who belong to different generations tend to want different things.

“A younger Millennial is probably looking not for telework, but for workplace flexibility,” Rowson said. A high-performing younger worker might appreciate the chance to clock in at 6 a.m. and leave early to play softball, whereas a middle-aged worker might prefer a workday designed around the need to tend to an elderly parent.

Managers also can offer flexibility and paid time off in exchange for accessibility — an easy trade-off in an era of smartphones, Rowson said. “I’ve seen better practices in the federal government in certain aspects of technology use and workplace flexibility than I see in the private sector.”

Paid time off to participate in volunteer activities is another reward that managers can offer their outstanding employees, Rowson said. So is the opportunity for professional development. IT projects require both subject-matter experts and project managers, he said. “Giving people opportunities in both areas by design, versus by happenstance, is a huge way during an economic downturn to help people believe that they are becoming more valuable, with greater income-earning opportunities when money is back on the table.”

That’s a strategy Gardner favors at Goddard, where he makes a point of giving top performers from the lower ranks, as well as from senior or middle management, leadership roles in major projects. “It gives them the chance to hone the skills of leadership during difficult times,” he said. “A one-time cash bonus is nice, but the chance to tackle new and more difficult challenges gives both the employee and our organization important benefits over the long term.”


Merrill Douglas Contributing Writer
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