According to a recent Wells Fargo Business Insights survey, poor cash flow continues to be a major worry point for small business owners across the nation. These findings come as no surprise given the overall decrease in consumer spending and consumer confidence coupled with inflationary pressures and high rates of unemployment.
But as more American workers succumb to debt-related stress and illnesses, small business owners in particular may be struggling to both hold on to their talented, experienced workers while keeping them motivated on the job. The problem: these days, money has become a big motivating factor, even as the owners of many smaller businesses are looking for low-cost ways to encourage their workers without having to offer them a raise they just can’t afford.
So how can you as a small business owner break out of this cycle- especially if you are struggling with your daily cash flow? One answer to this predicament is to offer performance-based pay increases, and the more that you can align your employee performance measures with the company’s overall bottom line, the better. Some examples of this in action: giving employees a cut of the revenues from all new accounts that they help to set up, offering a bonus for coming up with ways to improve quality or efficiency, offering bonuses for high customer satisfaction scores.
Why does this stand a good chance of working? If employee goals are in line with company goals, then your compensation methods can be a simultaneous call to action- as this entrepreneur discovered. Employees will be motivated to give it their best, to help both themselves and the company as a whole, and this could just be the boost your business needs to successfully ride out these difficult economic times.