Award Generously—It Costs Far More to be Stingy!

It's far easier to retain good employees than it is to find and hire them.

by Neal Whitten, PMP, Contributing Editor

PICTURE THIS: You are a professional, salaried to get the job done. You’ve been working 10–15 hours of overtime per week over the past few months. You feel that this extra effort is occasionally expected of those who have a reputation for "getting things done." The events that caused you to work the extra time were mostly out of your control, but you rise to the occasion and complete the job on time. You feel good about your accomplishment.
Within days, you are at a meeting when your boss singles you out and thanks you for the extra effort you have demonstrated, effort that yielded positive results. He hands you a certificate of thanks for your achievement. He also gives you a check for $150, with the suggestion that you use it for dinner for two at your favorite restaurant.
How are you feeling now? Probably great! Appreciative of the attention … Feeling good about your recognized contribution … Liking the certificate and loving the check.
Over the next weeks and months, you experience a feeling of wanting to give more. To help others more. To live up to the expectations that you perceive both your peers and management have of you. You like working here a little more than before.
Let’s examine what just happened. You received a "bonus" that amounted to about one dollar for every overtime hour you worked. And you are elated! What an easy and inexpensive method to win your continued dedication and support! Yet, many organizations—from my experience, most organizations—do not engage in this highly beneficial and cost-effective practice of quickly recognizing extra effort that has yielded measurable benefits to the organization, a client, the product … you get the idea.
Now let’s look for a moment at a more typical situation. After each bout of consistent overtime—what feels like a Herculean effort—with no tangible appreciation coming your way, you increasingly have doubts about this organization being the right one for you. You feel more and more used, perhaps even abused. You are even less motivated to spend extra time working on problems that are mostly beyond your control.
What happens? Your attitude and enthusiasm take a hit. Your productivity wanes. You begin to look for greener pastures. You find an outside offer that is too tempting to resist. You’re history.
Your leaving could cost your old company tens of thousands of dollars. How? The project will have lost a skilled resource. Schedules, budgets and even quality may be adversely affected. There may be a negative impact to the client and to the company’s relationship with the client. It may take weeks or months to find a suitable replacement—and what if that replacement doesn’t work out and yet another applicant search is required? I could easily go on with other negative ricocheting events that could come about from your departure.
The message? It is far easier to retain good employees than it is to find and hire them. A few hundred dollars well placed from time to time can save thousands of dollars. Even thousands of dollars spent rewarding outstanding contributors can easily save tens of thousands of dollars later.
Another tip: Never give certificates without also including cash or some tangible equivalent. Why? Because today, more than ever, such behavior is seen as a cheap, insincere method to patronize the employee for his or her continued best efforts. But don’t give cash without a certificate, either. After the cash is spent, there’s no lasting, tangible reminder of how much the employee is valued. Certificates can live on for years and be invaluable and recurring sources of pride.
If you are a project manager and don’t have the authority to give awards, then at least be a catalyst and work with the project members’ managers to influence fair but generous award giving. You will find that people will be more willing to go the extra mile for you.

IF YOU EVER DOUBT the appreciation a person feels for receiving a well-timed award, look at awards you received and recall how much they meant to you. Moreover, think how you felt when you worked in a stingy organization that continually overlooked awards. As I said, awarding for outstanding achievements is so inexpensive when you consider the alternative of losing the hearts and minds—or employment—of your employees and project members. Don’t risk losing your treasured talent. Award generously. It’s good business for everyone.

Neal Whitten, PMP, president of The Neal Whitten Group (www.nealwhittengroup.com), is a speaker, trainer, consultant, mentor, and author in project management and employee development. His books include The EnterPrize Organization: Organizing Software Projects for Accountability and Success and Managing Software Development Projects: Formula for Success.

This material is reprinted from PM Network magazine (June 1998) with permission of the Project Management Institute Headquarters, Four Campus Boulevard, Newtown Square, PA 19073-2399 USA. Phone: (610) 356-4600. Fax: (610) 356-4647. Project Management Institute (PMI) is the world’s leading project management association with over 50,000 members worldwide. For further information, contact PMI Headquarters at (610) 356-4600 or visit the web site at www.pmi.org. "PMI" and "PM Network" are trademarks of the Project Management Institute, Inc. © 2000 Project Management Institute, Inc. All rights reserved.

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