White Paper: Are rewards always the right tool for employee engagement?

creating an engaged workforce

Are rewards always the right tool to create employee engagement? A White Paper

Sodexo Motivation Solutions strongly advocates the benefits of rewards as drivers for creating higher levels of employee engagement.However, we also acknowledge that for companies to achieve the greatest benefit from rewards, other employee engagement tools and business fundamentals need to be in place.

This White Paper, written by Richard Parkes Cordock, looks at what some of these fundamentals are, and explores alternative ways to get the underlying basics in place so that your rewards can achieve the business goals you desire.

Are rewards always the right tool to create employee engagement? – A White Paper

Thousands of years of employee engagement

The employee engagement umbrella

The link between passionate, motivated and driven employees — and higher levels of revenue and profit growth has been understood for a long time.

Roll the clock back thousands of years to the days of Confucius and you’ll hear the saying ‘Man with sour face should not open shop’.

The ancient Chinese clearly understood the link between people and profit, and they knew that when employees are motivated, love their work and feel connected with the business, they deliver a superior level of service for their customers.

Customers pick up on this ‘emotional connection’ making them more likely to repeat buy and recommend. Hence, a direct link between people and profit.

Thousands of years later the same principles stand true, and the same challenge remains for business leaders which is: ‘How do you create a workforce which is motivated, driven, committed and focused on the needs and wants of your customers?’

This challenge of getting the best from a workforce is now well understood and is called employee engagement. The examination of how best to engage employees is the purpose of this white paper.

Employee engagement has become an umbrella term encompassing many areas such as internal communications, appraisals, benefits, salary, health, wellbeing, rewards (in which Sodexo Motivation Solutions specialises), personal development, training, mentoring, coaching, and many more. The list goes on.

Just as parents intuitively know, there isn’t only one way to get the best from their children — and children know there isn’t only one way of getting what they want from their parents — in business, there isn’t one single answer to create an engaged and motivated workforce.

As human beings we are complex, emotional creatures, with our own goals, ambitions, struggles and personal challenges.

The term ‘different strokes for different folks’ will always remain true, but it is also true that we share a common set of behaviours, and it is these ‘commonalities’ which the various engagement tools tap into to help get the best from employees.

Clearly each employee engagement tool has its own function and is an important contributing factor in creating a passionate, engaged and motivated workforce. But there is no single ‘silver bullet’ which is guaranteed to create lasting and unfaltering engagement for every employee.

Companies need to understand what drives engagement, and choose the right combination of tools and management approaches which work best for them. These may be different tools and approaches at different times.

Employee engagement tools recognise that as employees

We want to know what is going on: Internal Communications

We want to know how we are doing: Appraisals

We want to be well paid: Salary

We want to be rewarded for our extra effort and success: Rewards and Incentives

We want to learn: Training and Development

We want to feel good: Wellbeing

We want to feel safe: Health and Safety

We want to feel motivated and happy at work: Management and Leadership

We want to be part of something successful: All of these together (and more)


• Employeeengagementisnotaoneoffactivity—it’s something which needs working at every day.

• Employeeengagementisnotthesoleresponsibility of HR — it is the responsibility of everybody in the company, especially managers (both senior and line–managers).

• Employeeengagementisnotaboutasinglesolution (such as a survey or an appraisal) — it’s about using a combination of tools and management approaches wisely, to tap into the different emotional and logical drivers of employees.

What we do know however is that underpinning all highly engaged companies is a common set of fundamentals from which engagement can be built.

These fundamentals include:

• Astrongvision,purposeandaclearsense of direction.

• Acultureandsetofvalues.

• A‘reasonwhy’whichbringseverythingtogether.

Customers know the reason why they buy from companies, but often employees on the inside do not fully understand the customer’s ‘reason why’, or cannot clearly articulate it.

For example, customers of companies such as Apple and M&S know fully what the company stands for and what they expect from it. Apple and M&S have spent years and hundreds of millions of pounds creating brands which mean something in the minds of their customers. Customers clearly have a ‘reason why’ they shop there. Conversely, employees of those companies need to believe in the same ‘reason why’ — and if there is any disparity, customers will pick up on it and, in the long term, the brand values will diminish (as will revenues and profits).

This ‘reason why’ must be understood and believed by everybody in the company — from the most senior executive to the most junior employee, and from the oldest serving team member to the newest recruit.

The ‘reason why’ gives people a purpose to go to work each day and do more than they did the day before. This ‘reason why’ stops work from just being a job, and turns it into something more powerful, enjoyable and engaging.

We know that in companies with high levels of employee engagement, employees feel responsible for its success — just as if it was their own business.

The question is, how can you get the ‘reason why’ deep into every member of your workforce, and how can you turn it into something more powerful which best serves your customers?

What employee engagement is and isn’t

With so many marketing messages claiming to offer the ‘utopian’ answer to creating an engaged workforce, it is important to step back and understand what employee engagement is and isn’t.

Employee engagement and great managersAt the heart of all companies with high levels of engagement are great managers and leaders who create and communicate this ‘reason why’. These are not just great senior managers at the top, but are great managers at every level of the company.

They are not just managers in title, but real man–managers and leaders who get the best from their teams each day.

They may not even have ‘manager’ in their title. They may be team leaders or supervisors, but they are the key to creating engagement.

Managers are essential in getting the vision, purpose, spirit, brand values and ‘reason why’ down into the front line operation and helping employees ‘get it’.

Only when employees (both those who are customer facing and non–customer facing) ‘get it’ and ‘show it’, will customers see that as a company you really believe in the products and services you offer.

When customers see you believe, you have a much stronger chance that they will repeat buy from you and recommend you to their friends, family and business associates.

Problem Co. and Growth Co.To show how managers can help get the ‘reason why’ into your workforce, and how it can help create higher levels of employee engagement, let’s look at the story of two companies, Problem Co. and Growth Co.

Both Problem Co. and Growth Co. are identical except for one thing — one company is on the up, the other is on the down.

They both have the same number of employees, and sell the same products and services into the same market.

They are identical but for an invisible and intangible factor, something which is not reflected on either of their balance sheets.

That is their people’s attitudes.


Let’s look at each company in turnProblem Co.

The senior management of Problem Co. know they have a problem.

They know that the general morale and motivation of their workforce is low. They do have some high performers who are ‘fully engaged’ but at least 70% of their workforce are either not-engaged or, worse still, actively disengaged.

In Problem Co. there is a lack of ownership and responsibility, and an attitude of complacency is starting to creep in.

This is beginning to have a massive impact on the performance of the team. Productivity is low, team spirit is low and there is resistance to change. Key employees are starting to leave, with the low performers remaining.

There’s a lack of pride amongst employees and the negative energy and in–fighting in the Problem Co. is palpable.

This is naturally starting to have an impact on customers who are receiving, at worst, a below par experience, and at best an inconsistent one.

Customers pick up on the indifferent customer service, the lack of innovation, and they start to vote with their feet.

Before long, Problem Co. is seeing a drop off in new customers, repeat customers and referrals.

They are seeing both revenues and profits drop.

This vicious downward spiral continues, as engagement gets even lower when Problem Co. has to start cutting costs and making redundancies.

Growth Co.

Contrast that with Growth Co. and remember that Growth Co. is identical in every way to Problem Co. except for one invisible factor — its people’s attitudes.

Growth Co. is going places. Its employees are motivated, driven and emotionally connected to the business. They feel part of something, which is exciting, has a buzz about it, and is fun. They understand the ‘reason why’.

Customers love dealing with Growth Co. and make Growth Co. their supplier of choice.

Customers know that Growth Co. provides excellent products and services.

They love the creativity, innovation, and strong sense of passion and belief which pours out of all of Growth Co.’s employees.

For Growth Co., the link between engaged employees and engaged customers is tangible, and can clearly be seen in their P&L account and Balance Sheet.

Two extremes with a common link:

Whilst these are two extremes, there is a common link at the heart of both companies. The two companies’ respective failures and successes are not an accident.

The common link at the heart of both Problem Co. and Growth Co. is an environment which management has created.

The success of Growth Co. is down to management’s ability to get the ‘reason why’ understood and believed by each member of the workforce.

Conversely, although it may appear that Problem Co. have a motivation, engagement and retention problem, the reality is that management haven’t yet successfully created an environment where employees can thrive.

1 Your company may not be as polarised as Problem Co. or Growth Co.

In Problem Co. and Growth Co. we looked at two extremes. One company which has been brought to its knees through poor morale, and another company going places because of positive morale and engagement.

Most likely your company is somewhere between the two, and you are either looking for ways to increase motivation and engagement or looking for ways to use engagement as a way of taking your business to the next level. Either way, the principles outlined in this White Paper will work regardless of where you are in that development cycle.

2 You may only have a problem/opportunity in one particular section of your business

It’s also possible that you are a large company, and within it have a department, division or business unit which is like Growth Co. or Problem Co. (or somewhere in between). Again, it is realistic to expect that Growth Co. or Problem Co. may not reflect your entire organisation, but just part of it. The principles outlined in this report work for parts of companies as well as entire companies.

3 Your employees can quickly switch between engaged and disengaged

In the world of employee engagement, it is widely accepted that there are three types of employees. Research by Gallup suggests that these are:

• Engaged(29%)–Thesearepeoplewho ‘believe in’ and are driven and connected to the business. They are key employees who will take your business forward.

• Activelydisengaged(17%)–Thesearepeoplewho ‘do not believe’ in your company, or are the wrong people in the wrong places. They are actually damaging your company, and undoing thegoodworkofthe29%whoareengaged.

• Not–engaged(54%)–Thesearemiddlemen and women who neither over nor under perform. They do a good job, but often good is not good enough in the eyes of your customers who want excellence. The real opportunity for a business istoworkonthemiddle54%andtakethem to a higher level, whilst finding ways to better managethe17%whoaredisengaged.

That said, it is important to recognise that an employee who was previously engaged can quickly become disengaged, for reasons such as the influence a line manager has on them, or a change in circumstance at work, or even at home. Their change in attitude and level of engagement can have a negative impact on their colleagues and team morale, and effect the engagement of the rest of the workforce.

It is important to recognise that employee engagement is not just a tick in a box or a one off activity. It is something which needs to be carefully managed, understood and worked on every day – not solely by HR, but by every person of authority and responsibility in a company.

Three important observations on employee engagement


The importance of line managersLine managers are the critical link in any organisation between senior management and front line employees. They are key to getting the ‘reason why’ into the front line and keeping it alive there.

Line managers are the first–line point of contact for employees, and often the face of authority.

They can make an employee’s life bliss, or they can make it hell.

A good line manager can drive a company forward to unprecedented levels; a bad one can kill morale just by walking into a room.

All too often, line managers are managers only in title, and even though they have responsibility for performing annual appraisals, they struggle to get the best from their teams.

Frequently this is simply a case of managers not having the right tools or training to get the best from the people they lead.

Managers as mentors

It would therefore appear logical that management training is a key tool in the employee engagement story, and to some degree it is.

Having good managers and specifically man–managers is an essential backbone for achieving high levels of employee engagement.

Without good managers in place (especially at line manager level) who create an environment where employees can flourish, many of the other employee engagement tools such as rewards will not have the full effect they are capable of having.

But giving more management training is not the complete answer.

Many managers have been on management training programmes yet are still not getting the best from their teams. What we have found is that there is a step further which managers can take, to really create engagement in their teams and make sure the ‘reason why’ is understood and believed.

This step is to enable managers to become mentors to their teams, taking them on a journey of personal, professional and business development so that employees fully understand the company, the customer and this critical ‘reason why’.

Enterprise mentoringWhilst mentoring is widely accepted as a preferred development approach for senior executives, (where an outside coach or mentor comes into a company, and helps the leader develop), this is clearly expensive, and for that reason, typically only happens at Board level.

Mentoring is often overlooked for the rest of the company but, by using the right tools and approach, line managers can create highly engaged and passionate teams.

One specific approach which we have found to work and is used to get the ‘reason why’ into the workforce is ‘enterprise mentoring’.

Enterprise mentoring gives line managers the tools and a proven approach to bring the values, vision, purpose and ‘reason why’ right down into the front line — and create alignment between what is happening in the Boardroom and the employees who deal with customers on a daily basis.

Enterprise mentoring gives line managers the tools to get the very best from their teams, and helps to create an emotional bond between an employee and their company, managers, customers, and colleagues.

Through a combination of digital mentoring sessions and face–to–face mentoring, managers (mentors) and employees (mentees) get to learn some of the best–of–the best thinking from recognised business leaders and entrepreneurs in subjects such as customers, teams and personal leadership.

Outcomes from enterprise mentoring activity:

– Engaged, passionate and motivated workforce

– Lower staff turnover

– Happier repeat and referral customers

– More innovative and creative workforce

– Higher revenue and profit growth

SummarySalary increases, incentives and rewards can play a massive part in the motivation and engagement of a workforce, especially if done correctly and with careful thought.

But rewards need to be part of a wider and balanced approach to employee engagement.

Before companies move forward with rewards, Sodexo recommends they revisit their vision, values and culture, and make sure they have alignment between what is happening at Board/CEO level and what is happening on the front line.

If an employee does not buy into the vision, values and purpose of the company, or they feel emotionally disconnected, then there are larger problems at bay and rewards will not be the first employee engagement tool of choice to change this.

Sodexo recognises the important role line managers play in creating this alignment, and recommends that companies who are looking to improve engagement revisit the work done by their line managers, and consider helping them become mentors to their teams.

One approach you may want to look at to help create this alignment is an Enterprise Mentoring programme. This is where you give your line managers the tools to become mentors to their teams, and you give your line managers the tools to get the ‘reason why’ deeply ingrained into the entire workforce.

When alignment is in place, the impact that rewards will have on your business will be much stronger and deliver greater results for you.

It was the Beatles who famously said, ‘Money Can’t Buy Me Love’. There is some parallel to this in business.


About the author of this White PaperRichard Parkes Cordock is the founder of Enterprise Leaders Worldwide.

UsingtheprinciplesofNeuroLinguisticProgramming(NLP),thescienceofsuccess,Richardmetface–to–facewithover50UKaward–winningbusinessleadersto decode their leadership styles.

Through these digitally recorded interviews, Richard created the highly acclaimed mentoring programme –MillionaireMBA™whichisusedbyover23,000entrepreneurs around the world.

He later used the same teaching principles to develop Enterprise MentorTM (EM), which allows companies to engage with their employees, by taking mentoring out of the boardroom and into their workforce (at an affordable price).

Richard is the author of five business books: Business Upgrade, and Millionaire Upgrade, both were published by Capstone Wiley and both were former WH Smith Business Books of the Month.

More recently, he has written Profit Upgrade, People Upgrade and All Employees are Marketers.

Richard speaks to companies about employee engagement, leadership, creating an enterprising/entrepreneurial culture, how to grow your business through your people – and how to keep your customer at the forefront of your business.

About Sodexo• Sodexoistheworld’slargestintegratedfacilitiesmanagement

services organisation and leading global issuer of service vouchers and cards

• IntheUKSodexoprovidesinnovativefoodandmanagementservices to businesses and industry, including the education, healthcare, leisure and defence sectors

• Sodexoisoneoftheworld’slargestsuppliersofincentives and rewards

• TheSodexoGroupataglance: –380,000people –31,200sites –Operatingin80countries – Revenue of €14.7billion

• SodexoMotivationSolutions – €12.1billoninissuevolume– €711millioninconsolidatedrevenues

For more information about enterprise mentoring as an approach to creating alignment, please visit www.enterpriseleaders.com

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