Loyalty - Does It Really Matter?

The long-term success of any company depends heavily upon the quality and loyalty of its people. Few corporate executives would disagree with this idea conceptually.

More often than not, we have seen companies (especially the traditional ones) stress on Loyalty as an important value that employees need to imbibe. We have seen people spend a major part of their work life for a sole employer spanning over 3 to 4 decades. We have seen firms rewarding these employees through Lifetime achievement and Longest Player awards. We have seen them take up mentorship roles and act as the ones who will help in the inheritance of culture to the next generation of workers. They are the ones who have been with the company during the good and the bad times. They are the true loyalists – to be revered for their wisdom and the labour that they put in helping their company grow.

Ironically we have also seen that when bad times set in, these loyalists are the first in line to be shown the door! Firms that had been basking in the glory of the good times suddenly start talking about enhancing ‘productivity’ and reducing ‘unnecessary expenses’ (cost optimization) which had till recently been a mandate only on paper.

And it is also true that most employers treat the economic value of employees in enhancing customer relationships and company profits as "soft" numbers, unlike the "hard" numbers they use to manage their operations, such as the cost of labor.

So, Does Loyalty really matter these days?

Perhaps not if Loyalty is defined in its traditional sense.Times have changed dramatically and so has the relationship between employers and employees. Mostly these relationships remain transactional – “I would do this for you and you would reward me for what I do – nothing more nothing less”.

Perhaps this sort of an agreement is reached upon the very first day of appointment – when the candidate (or prospective employee) has already decided that he/she plans to stay with the organization for X years only – and the employer too who is well aware of this – plans and schemes things only for this X years that would be available to squeeze the maximum out of the employee. The burgeoning Job market has also meant that Loyalty derived from years of toil is today being transformed into mere commitment of a few years.

In light of such a transactional agreement, there are no chances of breeding loyalty. With the umpteen number of employment opportunities available these days, loyalty is not a necessary value that employees need to have – just minimum compliance to the rules and do what is required to gain the maximum out of the employer!( in terms of compensation, benefits and rewards).Moreover we are seeing the end of the lifetime contract with employers and the emergence of a generation who are more loyal to their careers than to their employers.

Hence there is fairness in the view of employers taking such a stand.

Loyalty, Performance and Profitability

Though Loyalty as a value is to be cherished – in a world riddled with competition – Loyalty without performance can do more harm than good. That would mean harboring those who refuse to leave their employer but at the same time are not being significant contributors to the growth of the organization. Loyalty then becomes a double-edged sword for employers! Some studies have shown that Loyalties' link to profitability, but most of these theories remain inconclusive and difficult to measure. More often these loyalists are the first causalities of a layoff.

The Resolution?

Welcome to the New Age Loyalty

The solution perhaps might lie in the way employers define and Rethink on Employee Loyalty.

It is essential to know that Loyalty is not a Either/Or proposition. Loyalty has to be mutual and not one way.

"Employees can give their employers 100 percent and provide great performance while furthering their own careers," says Joyce Gioia of The Herman Group, a consultancy based in Greensboro, North Carolina "The two aren't mutually exclusive," especially when the skills that a person masters to further her own career are also what the company needs.

• Matching Employee Aspirations to Company Goals

A key action would be strike a balance between the aspirations of employees and the needs of the organization. Most often employees feel that they have been betrayed by their employers by being refused a desired position or role. Whereas the employers are themselves constrained by the fact that they cannot satisfy every employee aspiration without significantly compromising on its own objectives.Its also vital that employees are communicated on why certain of their aspirations cant be met. This would bring a lot of things to the right perspective of those who are discontented. And every measure must be taken to ensure that such discontent is nipped at its bud. Remember these words of wisdom....

The best kind of loyalty is when both parties are benefiting.
— Scott Brooks, Gantz Wiley Research

• Build Relationships not Contracts

The world today is filled with contracts and agreements. Even personal relationships are based on Contracts with several strings attached. Though these contracts are good in the short run to achieve certain objectives, they rarely materialize into meaningful lifelong relationships.

Employers would have to go out of the way to gain employees' trust which will ultimately breed Loyalty - just as they would do with their own customers. Treating them as reliable, trustworthy and responsive individuals- who spend a good amount of their "awake" time working for mutual benefit (of himself and the organisation )- would do a lot in building employee loyalty.


Remember, healthy relationships last longer and don't carry an expiry date!

• Reward Loyalty - Show You Care
  

Rewarding Loyalty is one of the easiest ways to reinforce desirable values in the organization. Such recognition should be made in public. Apart from the generic rewards that get doled out as " Longest Player Award" or "Lifetime Achievement Award", it would also be desirable to praise them for their specific performances and achievements over the years.As an employer, one should place "Loyalty with Performance" as the most rewarded value of the organization.

One Final Word:

There's no doubt that for employers, committed, loyal and hardworking employees are their best asset. By learning how to retain high-value employees, you and your entire workforce can focus more on the overall success of your business.


I love contradictions and here is one on Why Loyalty Matters by Phil Gerbyshak posted on bizzia.com

Specialist or Generalist - Whats Your Choice?

The current slowdown has brought forward some interesting views on Career Development;

Generalist Vs Specialist

The contention between being a Specialist or a Generalist has become very valid with the present times. Not only would this be relevant to new generation employees (Gen Y) but also to employers who are looking forward to grow inspite of an uncertain global environment.

Businesses are on one hand looking at professionals who are versatile and possess a wide range of knowledge and skills ( The Generalist) - while there is also a compelling need to have those with indepth and extensive knowledge on certain specific disciplines ( The Specialists).

Those in favor of Specialization believe the age of "Jack of all, Master of none" is past; while the Generalists are forwarding their cause as Strategic partners in Business.

At this juncture it would be wise to understand the relative differences between a Specialist and a Generalist. (refer to the PPT in the above post).

Some distinguishing features between the two can be summarized as below:

• A Specialist focuses on Tasks while a Generalist focuses on the context in which the tasks are carried out.
• A Specialist as the name suggests possesses comprehensive knowledge on a certain discipline while a Generalist's knowledge may not be deep, but spreads across various disciplines.
• A Specialist is more concerned with the employment of resources ( i.e Doing) while a Generalist is inclined towards deployment of resources ( i.e. arrangements).
• A Specialist tends to DO more ( Tactics involved in carrying out a Specific task) , while the Generalist tends to DEAL more ( Strategy of Dealing with people and processes).

Courtesy Fred Nickols, 2004 - From Generalists and Specialists - Whom Do I Consult?

In Favor of the Generalists
The level of a person in the business or a specific job can play a significant role in whether specialization or generalization is required. More specialized knowledge and experience becomes less important the higher your position.Executives need exposure and knowledge of a breadth of topics, while lower levels may need more detailed knowledge of a narrower range of topics.

While a person may find himself in a position of specialization, it is important to keep in touch with areas outside that area of specialization. In order for organizations to remain lean and flexible, there is a push to ensure that all personnel (including managers) have a broad perspective and a broad range of skills. Employees who refuse to broaden their skill set or take on assignments outside of their area of expertise are valued less within company's ranks.

In Favor of the Specialists

Specialists focus on Core Competencies; just as companies focus on theirs . This fact turns the tide in favor of the Specialists. The world has changed dramatically. People now work in organizational networks, not true hierarchies. And ultimately businesses change so fast that the business you are running is likely to change right out from under you.In most cases the success of companies is dependent on deep levels of expertise and judgment that Specialists posses: not simply good management and leadership skills of the Generalists.

This is not to say that leadership capabilities ( that the Generalists so often portray as their core competency) are not important: they clearly are. But if you look at what we call "enduring organizations," they endure because they are very focused on their core competencies: they are the "best in the world" at one or two things.

Several leading multinationals like Intel, Microsoft, Pfizer, Qualcomm have flourished upon their dependence on Specialist Knowledge. These companies did not become billion dollar companies by hiring and developing "good managers" - they did it through expertise and specialization. Early in their lives they found their niche: they focused heavily on it over many years; and they build deep levels of skills, expertise, experience, and sustainable competitive advantage in these areas.

The Verdict

Now coming back to the question of being a Generalist or Specialist.

Well, this is something that the individual has to choose as part of his/her Career Decision. Knowing the pros and cons of both can help in easing the decision making process. One also has to be aware of the consequences of such a decision and its impact on ones future jobs.

A prospective Generalist should be inclined to learn the various facets of business. He should be open to more wider specter of knowledge that comes his way. His breadth of knowledge will determine his success.

A prospective Specialist will need to exhibit curiosity in knowing MORE. He has to choose his area of interest and make all out efforts to dwell into the depths of his chosen discipline. This will require hard work and the determination to know all that can be known and to search for the unknown.

So, Whats Your take? Specialist or Generalist!


Some interesting reads: Who Do You Hire: Generalists or Specialists? by Mike Smith

Why Should we Empower Employees?

Empowering Employees - The Need of Modern Businesses

I came across an interesting article at BizHelp24.com that I considered sharing with you. Its on Employee Empowerment. I am sure all of you would have faced a similar situation as stated below.


Taste this Case:

You buy a Television from an electrical store.

John the sales person advises you, and you go home with the TV.

When you arrive home the TV has a big scratch across the side.

You return to the store and tell John of your problem, and agree that for a partial refund you will accept the scratched TV.

John says this is a fair arrangement, but he needs to check with his line manager if this is ok.

(If John was sufficiently empowered you could receive the refund and leave satisfied now)

John comes back 5 minutes later with his manager, who asks you to explain the problem again. You go through the details of the purchase and the problem, and the manager agrees to the solution, but needs authorisation from the store manager.

(If the manager was sufficiently empowered you could receive the refund and leave now)

The store manager comes back after 5 minutes with John and asks you to explain the situation again. You go through the details of the problem, and the store manager agrees to a partial refund. However first he needs to get an authorisation number from Head Office.

(If the store manager was sufficiently empowered you could receive the refund and leave now)

After 5 minutes on the phone the store manager comes back and agrees to process the refund. Finally the problem has been solved, but at what cost?

To sort the problem the store has paid for:

1. John’s time
2. His manager’s time
3. The store manager’s time
4. The head office’s time

Not only that, but in the process of waiting and repeating yourself you may have (as most people would) decided not to bother shopping with their store again.

If John was given the power to do his job properly, the company would have saved the employee time costs, as well as kept a customer.

The answer in this case would be for John to know, and be able to enforce the company policy.

(E.g.: Maximum 10% discount or replacing the product)

Instead, you became a victim of un-empowerment disease, or “Run and check” syndrome.



Its indeed interesting to know that the same power and authority structures that HR built and protect are at most times responsible for restraining employees from giving their best.

Its time Organizations ( especially HR) show more trust on employees and empower them to face Business challenges. This is especially to those corporations that are so dependent on restraining power structures for their survival thereby crippling all chances of Innovation and Change.

One can see the following benefits of Employee Empowerment:

1. Freedom in Decision Making
2. Total ACCOUNTABILITY for the decisions taken
3. Customer Delight
4. Employee Satisfaction
5. Top Management is freed from Day to Day operational Decision and will have more time for Strategy
6. Gets Rid of Bureaucracy in the Organisation
7. Finally resulting in overall enhancement of Profits.

Do you think otherwise? Please leave your comments!