Industry Expert Reveals March 4, 2024 Selim Maalouf 4 min read
I had a plan: Alternate between this and my other blogging series (Marketing Building Blocks) to give my audience a weekly change of pace. But who needs plans, right? Not when new developments arise and succeed in getting my blood boiling faster than you can say "Happy Labor Day".
Nothing has been "happy" about Labor Day 2020. When the global pandemics are forcing workers inside and their businesses out, little do workers get to enjoy a day of respite. While most world giants and a minuscule number of small and medium businesses have managed to adapt to this paradigm shift, the majority of SMEs are facing a grim reality.
It is time to cash out their employee loyalty checks, and a lot of these checks are bouncing!
Balancing your loyalty checkbook
Employee loyalty is a powerful resource. It can perform miracles when all other solutions have doomed your business to failure. But make no mistake, loyalty is not a washcloth you use every time you need to wipe away your mistakes. It is like paper towels, you need to stock up beforehand, not waste it doing paper-mache projects, or else you will find yourself running through your house with your pants down.
If that analogy is too on the nose for you, let us talk in terms more suitable for business. Your employee loyalty is like a debit account. We are all familiar with how debit accounts work: You can only spend the money you deposit.
Having debit accounts comes with great perks: it facilitates payments and reduces the risk of carrying larger sums of cash around.
But with ease of payment comes the ease of spending, and if you do not keep yourself on a well-managed budget, you might quickly find your balance empty.
Not a credit account
Credit accounts are interesting: they allow you to spend money you do not have on things you could not afford. They are a sign of trust that your creditors give you. Your employee loyalty, however, is not a given. Before going out to spend it, make sure you give your employees a reason to be loyal.
Employee trust needs to be nurtured. Slowly and steadily nourished with small and consistent deposits. Be wary of grand gestures, for they are transparent and tend to be rejected.
But when can you spend your balance? Whenever you want! You can spend it as soon as you deposit it, which is what most employers do. They cash in quickly with a social media post, an internal memo, or a tight deadline. Self-congratulation is the easiest way to burn through your balance without you noticing.
Checking your balance is not free, though. If you want to gauge if you can afford a certain expenditure, your employees will feel you doing it.
Smart businesses, however, are those who practice patience.
Keep your balance for when you need it most
The current climate has shown us that even if you planned ahead for a market downturn, it is not easy to sustain through it without some sacrifices. These are the perfect times to utilize your accumulated balance.
I am sure that most of you have not heard the story of Dan Price, the CEO and founder of Gravity Payments. In 2015, Dan decided to cut his salary and the salaries of his management team and announced a 70,000$ minimum wage for all Gravity Payments employees.
The world erupted and quickly declared his business a "socialist time bomb" and called him a foolish, attention-starved, publicity seeker. But he knew that the well-being of his team would result in a better-performing company. And it did. People stopped worrying about their paychecks and started investing this new mental bandwidth into loving and improving their work.
Fast forward to 2020, Gravity Payments witnessed a 50% drop in revenue due to the sudden halt of consumer spending. Those same employees are now saving the company. Because they earn enough money to live, they volunteered to take pay cuts as high as 100% so the company wouldn't have to lay off a single person or raise prices to customers.
Not everyone should do what Dan did, nor are they expected to. But taking care of your employees without much expectation in return is worth it.
Organic is healthier in the long run
This whole argument becomes a moot point once loyalty stops being a resource you buy. Treating your employees with respect, empathy, and kindness should be an aspect of your culture, not a part of your benefits package. If you treat your people in a transactional manner, they will always treat you the same way.
Some things in life are easy: treating each other with respect and kindness does not cost us much. It does, however, put everyone on equal footing.
No cutthroat fighting for that next promotion, no imbalanced power structures that allow the exploitation of the weak, and no ladder to corporate success built on the shoulders of everyone who once shared an office with you.
But unless you are ready to walk in the footsteps of Dan Price, don't expect your employees to bail you out in the name of loyalty. You just created a nice juicy candidate pool for others to pick from.
Where do you fall? Is your loyalty easily bought? Or do you save it for someone special?
