A little over a year ago, the founder of a credit card payment processing company made an unorthodox move that resulted in some very mixed reactions and a whole lot of media attention. Dan Price, founder of Gravity Payments, cut his own salary by 93% (from $1 million to $70,000 per year). He did this so he could pay every single employee the exact same amount – $70,000, regardless of if they were the janitor or the receptionist, or how long they had worked there.
The story is not completely perfect and does come with some bumps in the road – his brother (and co-founder) sued him and there was also much speculation in the media about how successful this move would be.
However, it seems to have been a good decision in the long run. According to this story on Human Resources Online, revenue and profits have doubled; new customer inquiries jumped from 30 per month to 2,000 per month; customer retention rose from 91% to 95%; and only two employees quit. Add to that the 4,500 resumes the company has received since this initiative and it would seem that the company is thriving with sales, happy customers and very happy employees. In fact, the employees are so happy that in July 2016, they collectively bought their boss a $70,000 Tesla!
I am pretty sure that any business would love to enjoy similar demand, growth and employee engagement to that of Gravity Payments. However, few businesses are in a position to pay every employee an annual salary of $70,000.
However, the point of this story is really that this particular leader’s personal sacrifice was the ultimate act of appreciation. One that immediately showed his employees that he valued them. In response, the employees increased productivity and worked even harder to ensure their customers were happy. The Telsa, while a grand and generous gesture, was simply a small part of this story. The message here in essence is that engaged employees who feel valued and trusted are the cornerstone to your business’s success.
While many people assume that money motivates everyone, several studies in fact prove that simply showing an employee they are valued and appreciated motivates them more than any amount of money ever could.
Another great example is Doug Conant, the previous CEO of Campbell’s soup. When he took charge he did a tremendous amount to change company culture, including making a commitment to celebrate employees at all levels for their individual contributions and achievements.
During his tenure, he wrote over 30,000 handwritten thank-you notes to individuals that worked for the company. Past employees still contact him to this day and express how much that gesture meant to them. A single, handwritten note showed that employee that he appreciated them and their individual achievements. In so doing, he made these employees want to work harder, better and achieve more.
In our industry, where with each passing month sales staff are on a continuous roller coaster of hero-to-zero, it’s more important than ever to ensure that employees feel appreciated, valued and recognized, not just because of their sales numbers, but also for showing up and working hard. Even something as simple as personally handing out paychecks and thanking each employee can instill a sense of worth and show employees how much they are appreciated.
In doing so, perhaps… just perhaps, they’ll become more engaged, more productive and you won’t have to have a continuously running “Help Wanted” ad.