If you're an employer who's considering offering a 4-Day Work Week or other similar flexible working situation to your employees, it can feel extremely uncertain and financially unwise or scary.
With one simple strategy, you can take a huge amount of the risk out of the equation and ease into this, rather than taking a huge blind leap of faith.
The opportunity for employees to earn more paid vacation makes your job offering more competitive when you recruit top talent.
Today, we're going to talk about a very simple conversation that actually gets a lot more complex than it needs to be. When I talk to business owners, and we talk about the idea of a 4-day work week, a lot of them are excited about it for themselves, but they don't seem to understand how they could make that a possibility for their team members.
We want to try to have people look out for our business the way we look out for our business, but that can be difficult since your name is on the door and their name is not.
It’s possible to create a situation where you safely offer a 4-day work week possibility or something similar, and allow your team members to have a chance to create more time freedom.
So much of this is about being willing to show them you're willing to share. Of course, their situation, possible compensation, and benefits are not going to be like yours – you're the owner.
Or if you're a CEO or high level executive, and you're making decisions about how people are compensated and the rewards they have available to them, they're going to look at you as somebody that has more power, more influence, and more decision making ability than they do, and that's accurate.
That doesn't mean that they can't be engaged in a similar way as you.
We want to create a situation that clearly communicates - if they can achieve, they can receive.
It just comes down to setting up a conditional result where you say, “If you can get a certain result, then you can receive a reward.”
We need to consider how you measure an employee’s results in your business.
As somebody who founded and runs a 20-year software company now that helps reward employees for results, I can tell you for certain that non-financial rewards (paid time off, flexibility of hours, working remotely) are becoming increasingly important for employees.
Money always helps, and virtually everyone wants more money.
But just like there are people who are even more driven by power, status and / or recognition than they are driven by money… there are those who find time freedom, flexibility, and departure from routine to be more important than money.
Eventually, more money doesn’t do it for some people, as they experience diminishing returns on their satisfaction for the rewards they receive. Throwing more money at these people is, at the very least, a waste of money… and at the worst, frustrating (if they’ve asked for different rewards and feel ignored).
Most adults are okay with the idea that those who sell more or get whatever the desired result it), will earn greater financial rewards.
The same idea applies here. As long as everyone has a chance to participate, most will be okay with this. Those who don’t like this are probably not your ideal long-term employees anyway.
You can experiment with this and expressing it in different ways.
You could create reward levels based on results.
If a person performs at higher levels, they're going to get more rewards.
This can be extremely effective for sales producers because, they're usually trying to produce a certain number of results in a certain period of time.
This is a simple way to make sure your sales person is always motivated to get to whatever that top level is.
If you're looking to motivate a team member that's focused on more service-oriented tasks, what you often want most from them is consistency.
So the target result could be some sort of quality measure – customer satisfaction or customer retention, or whatever other measures you have to make sure somebody's doing well.
You could say, "If you do this for 1 month and hit this target number, you get a Friday off the following month. If you do this 2 months in a row, you get 2 Fridays off the following month."
In order to keep the streak alive, the employee must figure out how to become more efficient because they have less time to get the results. The motivation is built into the reward system.
This might be difficult for positions where people have to cover phones or an area for specific hours. It might eventually require some scheduling flexibility or even hiring additional people if you many people hit your desired performance goals (a pretty good “challenge” to have).
But the bottom line is, you're allowing the person to earn a reward. If the next month they can't keep up with it, they go back to square one, and they have to earn month one again, but if they got two in a row, now they're on a streak. If they get three in a row, now they get three Fridays off that following month. And four, again, all the Fridays off the following month.
It’s usually best to have the time off to be paid out quickly – usually the following month.
We don't allow people to accumulate time with this because we don't want somebody taking a large number of days off in a row. That's not good for the business. What we want is consistency.
As employees learn to be more effective, they become more interested in learning. So all the training you do that sometimes they're really not that excited about or interested in, becomes a lot more interesting when they realize not only can they earn more money, but they can earn more paid time off. And for a lot of people, the paid time off is an even bigger deal.
Now, to keep things simple, I have a few ground rules and you don't have to go by these, but it really keeps things manageable and easy.
Number 1, if you don't achieve, you don't receive. I'm not helping the business (or you, in the long run) if I give you a reward that you didn't achieve.
Now, if I try this for, let's say, three to six months, and I realized that my targets were simply a little high – I’ll adjust my targets. That's something different. But to outright give somebody something they didn't earn does not set a good precedent.
Number 2, rewards may be converted to money. That's something you want to discuss at the beginning, because some of your best producers will want money, not time off.
This is not about forcing them into a certain lifestyle. It’s about offering greater possibilities.
If they don’t want the time off, you can pay them the monetary equivalent of their day off.
Also, there might be seasonal situations or times where you're short-staffed and you say, “I need to pull the paid time off opportunity off the table. I'm still going to give you the money, but what's happened now is we just lost two team members. (or whatever happened), so I want to still honor the spirit of the agreement, but as I mentioned upfront, if we become short-staffed, then I have to change how I do it.”
The third ground rule, long-term achievement might lead to longer term arrangements or agreements. For the most part I don't want to guarantee somebody a 4-day work week at full pay that they're currently making (when I’m not sure if they will maintain the results of 5 days of work).
On the other hand, if somebody says, "I'd like to be paid the same hourly amount and just work less hours," I can work with that as long as I can make that work for the business. I’m hesitant to commit to person who says, "I want to make the same income, but work less hours." I have to make sure the results happen because to do otherwise, would be irresponsible to the business, the rest of the team members performing at a high level, and the person who’s not performing highly enough (as I’m misleading them into believing I can sustain paying them for subpar results).
You might not have this on your radar or you might be thinking, "Why should I even bother? Why don't I keep things the way they are?"
The first reason is employee turnover costs. If you've been in business long enough, you understand that one month, two months, three months of employee turnover can cost you thousands to tens of thousands of dollars.
If you have a person and you need to then hire a new person, but then while you're hiring that new person, the new person's being trained, they're not active, that's costing you money.
Reason #2 is that I want to keep my employees fresh, rested, and happy and reduce employee burnout & losing great employees.
Reason #3, I want to attract awesome workers. Better benefits = a Better Opportunity.
Reason #4, I only have to reward people if I get what I'm looking for. If I don't get the result, the reward doesn't go out. So this setup benefits me as well as it benefits the best employees.
If you want to get your employees to care about your business like you do or close, you want to create similar, but scaled down money opportunities AND lifestyle opportunities.
Constantly thank and appreciate them, and treat them like they're the biggest and most important investment in your company because - guess what? They are.
I encourage you to use the idea of rewarding PERFORMANCE LEVELS or PERFORMANCE CONSISTENCY and see what you can create.
Get feedback from others, and run a 90-Day Test, if you like.
Long-Term Agreements require a lot of planning and certainty, so stay away from those for now.
Just run a small experiment, and see how people respond.
If you'd like help with this, you can schedule an Implementation Blueprint call with me, and we can just look at what your current situation is, and explore what things could look like if you started moving in this direction.
I hope you find this helpful. As always, I look forward to helping you Help More People & Make More Money, In Less Time, Doing What You Do Best so you can fully enjoy your friends, your family, and your life.
Please make sure to let me know whatever I can do to help you and email me if you like.
All My Best,
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