Employee engagement, not benefits or luxury perks, crucial to staff retention

Stakes in the talent race are heating up, leading a number of companies to adopt fanciful perks as a recruiting tool.

Stakes in the talent race are heating up, leading a number of companies to adopt fanciful perks as a recruiting tool. The trend is so notable that a recent feature film - The Internship -showcased Google's novel perks, including free automobiles for the carless, on-site laundry and dry cleaning, free meals, massage chairs, and sleep pods.

But if employees are unhappy with management, perks don't work past a certain point - no matter how appealing - according to Gallup's 2013 State of the American Workplace report, released last June. Findings show that 70% of Americans either hate their job or are "disengaged" from their work and that engagement has the greatest effect on staffers' well-being.

In fact, should an organization decide against showering employees with lavish perks altogether, it would not necessarily harm its corporate reputation, according to W2O Group principal Gary Grates. It all comes down to the individual organization.

Company culture
One Fortune 500 company that does not subscribe to crazy perks is Texas Instruments, said Steve Lyle, director of engineering workforce development and university marketing, in an interview with Business Insider.

Although the semiconductor manufacturer does offer competitive financial and health benefits, the company's main focus is its culture, added Lyle.

"You don't have to offer perks for the sake of it," says Grates. "If the perks enhance the experiences of employees and they are complementary or supplementary to what the corporate environment is, then that is when they really matter."

Perks gone Wild

The perk craze has gotten so out of control that a platform – AnyPerk – has been created to help provide them to businesses. And the perk for the company's own staffers? Some are painted as dragon slayers.

To ‘reward' successful salesmen, German insurance giant Munich Re's Ergo division once organized an orgy with prostitutes, Chesapeake Energy offers employees Botox injections, and UK-based law firm Pannone foots the bill for employees going through a divorce.

Ben Carter, VP of compensation and benefits at Texas Instruments, told PRWeek, when it comes to attracting and retaining employees, benefits and perks only make up one slice of the whole work-life balance pie. Ultimately, keeping staffers motivated is the end-goal, and companies do this by making sure employees are working on challenging, innovative tech alongside diverse teams of talented, bright people.

"If you go to a workplace every day that offers free lunch and massages, but don't enjoy what you do, those perks do not really matter," says Carter.

Likewise, Dell found that helping employees do their jobs better mattered most.

"We offer our staff competitive benefits and a host of programs including childcare and product discounts," says Colleen Ryan, Dell's director of corporate communications. "That said, staff feedback indicates that programs such as Connected Workplace, which impact their day-to-day quality of life, matter most."

The initiative facilitates a more mobile workforce, she adds.

Many factors that make a big difference to employees are small things that don't cost a lot. For example, when GM's newly named CEO Mary Barra was the automaker's human resources VP several years ago, she instituted a no-dress-code policy at the company.

"That had a really positive impact on our staff," says Selim Bingol, GM's SVP of global communications and public policy. "The key is listening and trying to understand how we can make it easier for our people to be successful in their work."

When perks backfire
A perk that may sound appealing in the short term, which aids an organization's recruitment efforts, may backfire in the long run if the workplace lacks employee satisfaction.

"If you are going to give everybody a sabbatical after one year, what would that do to your business?" explains Grates.

Sometimes, a perk might enhance the caliber of staff recruited, but could also cause problems in productivity. Furthermore, the same staffer who joined for the sabbatical might leave after taking advantage of it.

"The foundation of any business must be respect," Grates adds. "Sometimes you can use perks to hide the fact you don't have that, but then perks end up just being Band-Aids."

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