It's 2019. I don't have to explain to you about the importance of keeping your employees happy. So I'll just say this: Of all the factors that can influence your CX, employee happiness is probably the most significant one. An ineffective strategy will take a while to affect your CX, but unhappy staff can bring your CX to the ground today. Having said that, let me first acknowledge that almost everyone works in order to make a living. And that means the paycheck is critical to make everything work. Not very long ago, the paycheck used to mean something very straightforward: Hourly wage times hours worked, plus any incentives. Today, it's a more complicated model with more moving parts than that. Based on my conversations with business owners, leaders, and recruiters around the world, here's a practical look at what today's paycheck consists of. The simple monetary component
People need to buy groceries and pay rent/mortgages. The monetary component of the paycheck is the most common and most well understood one. An employee gets paid a certain amount of money in order to manage a certain set of responsibilities and meet a set of expectations. Most pay-related negotiations are focused on this component, and sometimes recruiters even get paid incentives on how much lower they're able to negotiate this component. (I'll comment on that practise in a separate post later, as it requires its own post)
It's becoming fairly common for companies to offer equity or monetary incentives, contingent on the candidate fulfilling some expectations upon joining. These are essentially bets that the companies are taking on the candidates/employees. Another way of looking at this is, these are actually bets that candidates/employees take on their own potential. If you don't offer this component already, I strongly recommend you look at this line of thinking. This component ties an employee's personal success with the overall organization's success. It can also help some employees steer through patches of impulsive disbelief in the system.
The support services
Anyone who has observed large technology companies like Google, Facebook, Salesforce, and the like, would've certainly heard of the bordering-insane perks these companies offer to their employees. In simple terms, these perks are all just "support services" that take the mundane personal grunt work out of employees' minds and give them more space to think about meaningful work. The more time and space employees have, the more effective they become. When employees don't have to worry about laundry, picking up groceries, preparing meals, or other such everyday chores, they have the space to think about how they can make their work better. Surely, these support services come at a cost to the employer. However, when there's a certain critical mass of employees, the fixed cost of these services can come down drastically.
The brand and community
This component of the paycheck is harder to quantify. Employees/Candidates tend to gravitate more towards brands they personally love or respect. Merely working for this brand means something to them, and keeps them happy. I've personally observed this behavior amongst people who work for companies like Amazon, Tesla, Coca-Cola, Southwest, Apple, and Mozilla. In some cases, recruiters might use this affinity to negotiate harder on the monetary component of the paycheck. The investment a company makes in establishing and maintaining its brand value also brings returns in long-tail areas like employee happiness. Employees feel proud to represent a brand that customers love to be associated with. This social prestige can mean a lot to some employees, more than what one might imagine!
The emotional gratification
Although it may not be widely observable, there is a certain emotional gratification associated with roles in some verticals. Hospitals, non-profits, therapy, legal are all verticals where employees genuinely love helping "customers" out. Employees get to make a direct impact on the lives of the people they help, and this goodwill outweighs incremental monetary benefits for many people. Several non-profits attract great talent owing to this component. These candidates often stand to make much higher pay in the for-profit industries, yet choose to find meaning in helping other people.
There's a growing movement of remotely-run companies, largely owing to the explosion of Internet businesses. It's hard to run a manufacturing business with remote employees, but it's significantly easier to run a SaaS company with remote employees. Allowing people to work remotely has many benefits. It takes people off the roads, and away from the cities. It allows employees to set their own schedules and not not necessarily adhere to a set timetable. People who work from their hometowns tend to be much happier as employees than people who have to move to a large city for work. This is true worldwide and I've met dozens of people who prove this hypothesis. However, running a company remotely has a (sometimes steep) cost in terms of collaboration and communication. This cost is hard to quantify per employee, but it can be observed behaviorally.
Finally, it's worth noting that many people just get hooked to a bold vision. People put their other priorities aside, and may even put their own lives at stake, when they go all in on a bold vision. Military and space exploration organizations largely attract such people. But the same logic also holds good for bold-bet companies like Tesla, Google, Amazon, Uber, Crypto-companies etc. Employees often have to work extra hard as the odds are stacked against them to begin with. But their belief in the grand vision can provide the necessary motivation to do. Also, it may not hurt to give them equity or performance-linked bonuses! ;-)
The paycheck you offer to your employees consists of many or all of these components. All of these components involve a certain cost to your company. It may not always be monetary, but there are costs nonetheless. Being aware of these components is the first step towards assembling the paycheck of the future.