This post is from derived from my recent post at the Compensation Cafe.

After more than two decades of slow but steady erosion and a few body blows in the recent recession, the state of job satisfaction, and more importantly the state of the overall employee-employer relationship, are at new generational lows. Employee morale is in the tank, and the willingness of workers to bolt at the next opportunity is at a multi-year high. Numerous studies have shown these trends, including the recent Conference Board report, which confirmed the multi-decade low in job satisfaction.

The 2008-2009 recession was a real punch in the gut to an already injured relationship between employers and their most "valuable" asset (at least that's what a lot of annual reports say). Between the massive layoffs, skimpy or non-existent pay increases (or outright pay cuts), and with the on-going push for "doing more with less," the foundation of the employee-employer relationship has weakened considerably over the years and is in need of some serious shoring up.

Some HR and compensation professionals have told me they think "engagement" is an overused buzzword. Even you may believe this, but just think about your typical "dis-engaged" employee and ask yourself how much value they bring to your organization?  Buzzword or not, having employees who are actively engaged in their work and believers in their organization and leadership is absolutely critical to organizational performance and maintaining a psychologically-healthy workplace, where people tend to thrive and stay.

So, what's an employer to do? How can we enhance this somewhat nebulous "engagement" concept?  If you're looking for simple/easy, "plug-and-play" solutions, they don't really exist, but here are several areas that merit your consideration:

• Increased/enhanced communication: nearly every broad-based or organizational study I've seen has shown a desire on employees' part for more communication, about their organization and their goals, and especially about their job expectations and performance. Communication takes some time and effort, but it's virtually free to provide it, so why do so many organizations fail in this key element of management and leadership?
• Increased transparency: who doesn't want to know how and why they are paid what they are? The more open you can be about your compensation philosophy/strategy, and how as an organization you're meeting the goals of your compensation program, the better off you'll be in the minds of your employees. Transparency fosters trust, while a lack of it may foster distrust.  If you have a soundly-built and competitive rewards program, what's to hide? Share the truth! I am not suggesting total transparency or gritty behind-the-scenes details, but if you've got a program you can be proud of, share it, and how your organization's' approach is a win-win for the organization and its employees.
• Recognition: recognition is the missing link in many rewards programs, and a failing of most management teams.  Can you catch your employees performing highly, going above and beyond, or notice those who provide great customer service on a regular basis? Are you ready and willing to provide genuine appreciation and recognition for/to your most valuable asset?  Recognition, a corollary of communication, is inexpensive to deliver, but can provide great psychological benefits for your workforce, and eventually to those who practice it genuinely.
• Listen, trust and empower: this may not come easy for some managers, but managers who can learn to listen better, trust in their staff, and delegate more responsibility and authority (and with the resources/tools to handle it) will find that most employees respond quite favorably to this approach. While some staff want to be led by the hand, most workers want to be heard, to have input into their work, and have the trust, resources and authority to get it done.
• Develop thy managers: Have you ever heard the phrase that people don't leave their jobs, they leave their manager (or company leadership)? Well, in most cases it's true. People tend not to leave managers and companies they respect and like working for, but they do tend to leave ones they don't believe in. Thus, it's critical that companies train and develop their management teams, as well as reward their best people managers, while dealing with the ones who aren't (see next point).
• Get your management performance act together: organizations that don't address performance issues within their management/leadership teams are destined to have morale and dis-engagement issues within their non-management ranks. Working for a poor manager makes your work life suck, is the single biggest contributor to turnover and poor morale, and is a guaranteed "engagement killer."
• Cash compensation: let's not forget that most folks are to at work trying to make a living for themselves and their families. But notice, it's nowhere near the top of my list. Dollars are very important, but you can't buy workplace love. If you were one of the many employers that engaged in wage cutting and other forms of pay-related retrenchment during the recession, then the first thing you should be thinking about is getting at least back to where you were prior to those cuts.  After that, it's time to start thinking (or re-thinking) about competitiveness with the external market for your talent. Paying competitively won't guarantee you anything, but it should reduce pay-related turnover, and enhance your ability to attract and keep talent. Don't believe that just because the labor market is a mess right now that it renders this topic as unimportant. Staying competitive always important, as there is always a market for top talent.  Several studies have shown that a high percentage (over 50%) of the workforce is ready to move onto the next opportunity when it presents itself, so don't help push them out the door by ignoring this critical aspect of the "employment deal."
• Developmental opportunities for professionals: when times get tough, training and development budgets are usually one of the first things to be cut. If that's the case at your organization, you should help to make it one of the first things to be restored. Beyond being appreciated, communicated with and paid fairly, the opportunity to learn, grow and develop is high on many people's importance list. A lack of growth and learning opportunities is a significant competitive disadvantage for any employer, but especially in the so-called "knowledge" industries (technology, scientific, engineering-related, etc.) where ongoing education and learning form the collective knowledge backbone of the organization.

Well, that's my list.  I'd like to hear your thoughts too.  Go forth and actively nurture satisfied, motivated and engaged workers!

Doug Sayed is principal at Applied HR Strategies, a Seattle area compensation consultancy and lead author of the StrategicPay Series Base Pay Toolkit, a hands-on, "do-it-yourself" (DIY) guide to developing a strategic market-based compensation program, complete with dozens of pre-built tools and templates, ready for use.

Some of my fellow bloggers at the Compensation Cafe' have been writing recently on how to address the issue of today's small merit budgets with employees and managers.  Here are a few links to help you with these issues:

• 10 Things Your Managers Must Tell Employees about Your Teeny, Tiny Merit Budget by Margaret O'Hanlon
• 10 Tools for Communicating a Teeny, Tiny Merit Increase Budget, by Margaret O'Hanlon
• Despite Pay Dissatisfaction, Most Employees Expect to Maintain Current Level of Benefits in 2010, by Becky Regan
• Show Your Creativity as a Rewards Professional, by Doug Sayed

In addition, I would add a few other key thoughts, such as:

• Job Titles: Are They Really Free? by Ann Bares
• Food for Thought: Pay for Performance Obsolete?, by Darcy Dees
• Agility. The New Reward Watchword, by Ann Bares via Compensation Force

So, while there may be a shortage of funds available for organizations to distribute, there is no shortage of ideas and creative strategies for addressing today's challenges.  If there was ever a time to show your worth as an HR and/or compensation professional, now would be it!

Where is your organization on the compensation transparency continuum?

It's an especially relevant question in today's world of instant access to just about anything. For those of you working in the HR/compensation field for more than 10 years, you probably remember when pay data was something that only a small number of  people in your organization ever saw or even knew about, and it was kept in a locked file cabinet. Today, pay data is everywhere (of course, a lot of this data isn't particularly valid, but that's a post for another day).

Some organizations are remarkably open about their pay programs and pay philosophy/strategy, while others remain tight-lipped about anything related to how compensation is determined and communicate accordingly.

Today, while reading an excellent white paper on the subject put out by the folks at KnowledgePay, it got me thinking that its time for the more "closed" organizations to re-think the whole openness and transparency issue.

To me, openness and transparency, while similar concepts,  are not exactly the same. Openness refers to the degree that the company is "willing to open up" with regard to the details of its compensation philosophy, strategy and program(s).  Openness is more of a strategic issue that HR and senior executives struggle with (what and how much do we communicate?). 

Transparency, however, refers to the degree that program participants can "see" how their compensation program works and how it impacts them.  Openness certainly contributes to this, but transparency goes a step further, referring to what we call the "what's in it for me" question ("WIIFM").  All rewards-related communications (base pay, incentive, benefits, etc.) efforts should keep the WIIFM question in mind as the communications plans are developed.  It's really the one question that virtually everyone thinks about when you communicate to employee groups about anything pay related." (Base Pay Toolkit, 2009).

Research has shown that greater openness and transparency can create greater levels of trust, which is a desirable state for any organization. For instance, studies done by Watson Wyatt have shown that companies with greater levels of management/non-management trust have achieved significantly higher levels of total shareholder return than organizations that have low levels of trust.

Am I arguing for total openness and transparency?  Absolutely not!  But I am trying to argue for enough openness and transparency to foster understanding, greater levels of trust, and so employees can answer the WIIFM question that all employees want to know.

"A lot of the debate about pay transparency is misframed.  Too often it is focused on what employees are paid and the idea that employee pay data should be made more public.  This is not transparency - this is an invasion of privacy. An appropriately transparent pay program is one where we have communicated with employees the why and how of the organization's pay practices." (Ann Bares, Altura Consulting Group).

My feeling is that if your organization has built a competitive rewards program based on sound principles and analysis, what's to hide?  Share the news!

So, in today's' world of instant communication and information accessibility, what is the "right" or "correct" amount of information that should be shared with the workforce?  Ultimately, that's up to your organization's comfort level, but we do know that with greater openness and transparency, it is likely that your organization will help to foster healthy levels of trust, and likely a stronger ability to attract and retain the talent you are seeking to move your organization forward.