Organizations need to attract, retain and motivate employees.

Contemporary organizations need to understand how to attract, retain and motivate employees of different ages, genders and ethnic backgrounds. The importance of trust, contribution, and reward (Pfau & Kay, 2002) cannot be ignored as an area of commonality for all employee groups. Generational differences affect organizational and work perceptions in the above three areas.

It is imperative that organizations understand the aspects of recruiting, retaining, and motivating a diverse group of personnel that range across four generations. This will allow them the optimal opportunity for success in their organizations. This article evaluates the importance of trust while identifying the many components that comprise this trust between the organization and the employee. Next, it evaluates the importance of contribution as employees want to contribute and become involve in the decision-making processes. Further, this article evaluates the importance of rewards and its’ impact on the organization. Finally, this article evaluates whether the generational differences affect organizational and work perceptions in trust, contribution, and reward.
Importance of Trust
The importance of trust is breakable like glass, once it is broken, that piece of glass is never the same. Individual’s trust in organizations is very similar to this analogy and once it is shattered, it influences the organization severely. With the current economy sinking, CEOs are proving this point as they forsake the consumers, shareholders, and employees as they accept large payoffs as the company goes bankrupt. A Gallup poll confirmed this point when it found that 90% of American did not trust CEOs to look after the interest of their workers while only 18% trusted them to look after their shareholders (Bennis & Goldsmith, 2003).
Shurtleff (1998) provided the following three meanings for trust: (1) employees believing that words mean what they appear to mean, (2) employees experiencing actions that are consistent with the verbal or written message, and (3) employees having faith that people and the organization as a whole will do what they say they will do. Many companies acknowledge the value of building commitment among employees and customers as a realistic approach to improve the organization. Commitment and trust are joined at the hip. Leaders who earn trust
from their subordinates will have lower turnover and create long-term loyalty (Shurtleff, 1998).
Leaders must promote trust in their companies and understand the importance of trust. Many factors make up trust in the organization. Within organizational trust, factors such as integrity, competence, and employee rapport are at the forefront (Shurtleff, 1998). Even with these factors at the forefront, trust was still one of the most complicated traits to sustain. Employees need to feel important, appreciated, trusted, and that the organization will act in their best interest. Several events in recent years have made this task a very difficult endeavor.
Employees have a tough time trusting an organization after a violation of their trust. Scandals such as Author Anderson accounting fiasco, Enron, Tyco, and World Com validated this mistrust (Robbins, 2005). In addition, other world events such as 9-11, turmoil in Middle East, and the Catholic priests abuse of children have contributed to this mistrust. Of course, this left a huge challenge for leaders as they undergo this scrutiny (Levit, 2007). Employees are just waiting for the leaders to displace ethics in order to benefit themselves vice the employees or firm. It leaves the employees with a cynical impression of the leadership when this happen. Therefore, it is important that leader’s actions must be of the highest standard and match their words, which allows trust to prevail in the organization.
The bottom line in trust is that only individuals can earn, develop, or retain employee trust, organizations cannot (Levit, 2007)). Trust is about interaction between individuals even though the company may determine policies and practices for the promotion of trust (Pfau & Kay, 2002). Primarily, the leader’s behavior establishes the level of trust in an organization. Honesty between the leaders and subordinates is a sure way of sustaining trust (Robbins, 2005). Consistency and predictability in a leader’s action are critical. A leader’s integrity forms this organizational trust and it does not waiver whether the times are good or bad. It is these small events, merge together that help secure and preserve trust within organizations. According to Pfau & Kay (2002), leaders must create trust in organizational effectiveness through an effective vision and capable leadership skills.
Trust is the critical element that inspires a leader’s followers and allows them to make a significant contribution (Gibb, 1991). Individuals desire and want to be part of an organization that they can trust. Trust is quite different from competency and much more difficult to obtain. This provides validity to the fact that there are many more managers than leaders. The primary difference between trust and competency is that leaders gain competency through means such as experience and practice while followers impart trust upon leaders (Gibb, 1991).
The perception of a leader’s performance is more important than the actual performance (Levit, 2007). In general, people allow their actions to speak for them. For example, what they espouse is what they do and this is synched with what workers want and need. Leaders are able to control themselves in difficult situations. They are calm under pressure and do not act recklessly. Leaders are ambitious or they would not be leaders, however, they are also ambitious for their workers (Gibb, 1991). They trust the workers as much as the workers trust them. In addition, their actions bring out the best in the subordinates.
Trust supplies the energy and motivation that makes it possible for organizations to be successful (Shurtleff, 1998). Organizations without trust are normally not long-term or visionary and often fail. Trust motivates heroism, sells product, and keeps communication thriving in the unit (Shurtleff, 1998). Another analogy for trust is to compare it with leadership since they are both hard to depict or define. Individuals know when leaders display these elements and when they do not. Followers trust predictable leaders with known positions. In tune with this, trusted leaders make themselves known and their positions clear.
Trusted leaders have inspiring visions for the organization that are clear, attractive, and attainable (Robbins, 2005). Their vision provides a context of shared beliefs and a common organizational purpose with which the followers can identify. The followers feel involved in the vision, empowered to bring the vision to fruition and integrate it into their lives. The leader must communicate the vision in such a way that it is available and inspiring to others so that it will be a catalyst for change (Pfau & Kay, 2002). This endeavor requires careful planning by the leaders while understanding that others have different concerns from them. Leaders want to keep the foundation of their vision but allow subordinates to rework it so they can have maximum buy-in from them.
Trusted leaders have unconditional empathy for those who live in their organizations. Followers trust leaders who they know can walk in their shoes and the leaders let them know that (Pfau & Kay, 2002). Trusted leaders may have a plethora of viewpoints, but they still can see the world as their followers see it and understand what their followers are going through. When leaders empathize, they are making a conscious effort to listen to the other person and hear what they are saying in the context of their own orientation, needs, and perceptions (Gibb, 1991). The leader’s attention is on the other person rather than themselves. Leaders accomplish this through feedback, asking questions, interaction, and displaying their point of view as it was your own.
The behaviors of trusted leaders are consistent with their values and the commitments they have. Employees tend to trust leaders when they know where they stand in relation to their organizations, as well as how they seek to orient their organizations in relation to the larger environment (Robbins, 2005). Followers understand how these leader’s commitments have evolved and are willing to reconsider them in the face of new evidence. Many times these values and commitments become the standard for the organization. For example, in the Air Force, a commander, in conjunction with their values and commitment, establishes the standards for a 600 plus personnel unit.
A trusted leader’s integrity is indisputable. According to Bennis & Goldsmith (2003), followers trusted leaders who stand for a higher moral order and who demonstrated their ethics and values through actions they observed. Leaders uphold a standard of ethics, encourage others to act on their shared values, and call themselves and others to account for deviations from what they know is right. In the Air Force, there are many opportunities to violate a subordinate’s trust, but trust through integrity is doing the right thing even though no one is looking.
Importance of Contribution
Leaders must give employees a chance to contribute by developing the worker’s skills and potential (Pfau & Kay, 2002). Capable employees are devoted and assume more control and ownership over their tasks. Leaders are able to concentrate on broader issues because their subordinates require minimal supervision. Leaders use a plethora of options to enable their employees the best opportunity to contribute to the success of the organization. Leaders need to ensure that the employees understand the long-term visualization of the organization and the impact of this on their job and potential (Pfau & Kay, 2002).
They also need to provide specific feedback to their subordinates on their performance so that they can provide the best possible contribution (Robbins, 2005). In providing feedback, leaders must ensure that the employees also comprehend the company’s expectations and that they listen to ideas and suggestions from them. Challenge the employees, involve them in the decision making process and give them the freedom to accomplish tasks without unnecessary restrictions (Robbins, 2005). Leaders should also pay for developmental training so employees can grow their skills at workshops.
Satisfying work, job security, clear opportunities for upgrade and promotion, a challenging corporate mission, ability to share in the organization's success, and a feeling that their skills are effectively used and challenged, all contribute to the employee’s perception of contribution (Slack & Parent, 2006). If an employee identifies himself or herself with the organization, love their work, and perceive their organization to be flexible, then they will want to stay with the organization. According to Pfau & Kay (2002), leaders need to provide the opportunity for employees to contribute by allowing them to use their skills and involving them in decision-making.
An important feature pertaining to the importance of contribution is giving employee a chance to use their skills (Pfau & Kay, 2002). Employees do not want to perform repetitious work with no challenge, day after day. They understand that repetitive jobs are a part of any occupation; however, they still want some aspect of that job to provide some element of interest to them. With an interesting job, complacency does not become a factor, and an organization can reap the benefit of employees who are fully utilizing their talents and skills. It is imperative that organizations understand this dynamic and take the appropriate action to ensure they provide the employees with challenging opportunities so they can maximize their skill in completing the mission of the organization.
Employers can give employees a chance to contribute through effective information. This knowledge or information is power and employees must have this information to be effective and maximize efficiency in the workplace (Robbins, 2005). Leaders should inform the employees of their individual performance along with the overall performance of the organization. An open avenue of communication such as this enables vision sharing, information sharing, inspiring employees and fosters a friendly climate to ask questions.
Another vital ingredient regarding the importance of contribution is employee’s involvement in the decision-making process. In order for employee’s involvement in the decision-making process, the company must implement decentralization. A company will decentralize because it is virtually impossible for an individual to comprehend all the challenges to make the appropriate decisions in a organization (Slack & Parent, 2006). For example, in the military, how can the commander of a major command with geographical dispersed units make informed decisions without input?
Even in the age of advance technology, a single individual does not have the time or capability to make such decisions. Employee’s involvement who understands the intricate details of the event is necessary for efficiency efforts. In addition, by involving the workers, the leaders now are able to dedicate their efforts to strategic challenges for the organization.
Employee’s involvement in the decision-making process enables an organization to respond rapidly to changes (Slack & Parent, 2006). Information does not have to be disseminated through the bureaucracy before the organization can render a decision. Furthermore, the employees are usually the closest to the decision, therefore, they can respond best with the necessary information needed for resolution. This greater commitment because of employee’s involvement results in greater acceptance of the decision by the employees. They will take responsibility for the decision and the implementation of the decision. Due to this buy-in from the employees, they demonstrate more effort in the execution of the decision.
One of the biggest advantages of employee’s involvement is the motivation potential that it offers for the employees (Slack & Parent, 2006). It enables them to better understand their role in the organization how their efforts contribute to the goals of the organization. This is critical for employees in understanding decisions that may affect them. It also improves communication throughout the organization and results in greater commitment to the organization from the employees. Filley et al. (1976), confirmed this point in an analysis of a study on participative management. In addition, Miller & Monge (1986) conducted an additional study and reported comparable results.
Many opportunities and problems confront leaders today and as the speed of business continues to increase, their decision time decreases. Employee’s involvement can serve as management development for your employees. This is invaluable training for your subordinates as they grow and mature into senior leaders. This involvement equips the employees with much needed experiences that they can apply with decision-making as a senior leader.
Importance of Reward
Pfau & Kay (2002) said that it was through the importance of rewards that attracted, retained, and motivated employees to do well. People want a competitive reward system, see the appropriate personnel rewarded, and poor performers trained or terminated (Pfau & Kay, 2002). Through the use of positive performance, employees continued the performance and behavior for which they were rewarded. A key under this concept is that leaders must know what is of value in order for subordinates to be the most effective (Milkovich, 1991). The organization must match the reward and the person. For example, if an organization promotes a person to activity manager and their desire is promotion to flight chief, then a mismatch exist because the reward does not match the individual desire. The mismatch serves the same purpose as no reward to the employee.
A reward system is ineffective if it is of no importance to the workers. The worker will not strive to reach the expected performance because of the reward system. If the worker sees no benefit from the reward, then there probably will be a lack of motivation and commitment to the task (Milkovich, 1991). For one individual, a move from a base-level position to a wing-level position may be unwarranted since they wanted more money and not more responsibility. In this case, the individual sees the reward as insignificant, thus the reward does not motivate the individual. Leaders should use a reward system where all employees have the opportunity to participate in and receive rewards from the system (Wilson, 2002). If the reward is meaningful to the employee, then it is an effective reward system.
Leaders must create an environment where workers have a diverse amount of rewards in the work they do. These rewards are lateral or vertical and can come from linkage to the work, peer related, or special recognition from management. In a customer service environment, the reward system should allow for a win for the workers and customers. Reward systems provide workers the chance to share in the success of their contributions. Reward systems are not established to manipulate the workers, because this would result in certain failure. They are established to bolster progress, accomplishments, and service to the customers, which will result in successful operations (Wilson, 2002).
Leaders should not have a rigid reward system. For maximum efficiency, flexibility in the reward system is necessary. Leaders that customize the reward to the employee have a better chance of motivating their personnel. The individual feels special and identifies more with the reward. Of course, this should benefit the motivation of the individual. The frequency of the rewards is another important element. Employees like to know with certainty that a reward is forthcoming. This frequency definitely adds trust to the reward system. Employees are confident in the timely rewarding of their work efforts.
Pfau & Kay (2002) acknowledged that an important characteristic of a reward system is its ability to separate the performers from the nonperformers. If a company is not providing this distinction, it is wasting efforts on a system that is ineffective. An effective reward system is one of the most dominant resources in a company’s toolbox for recruitment, retention, and motivation of the best personnel. Pfau & Kay (2002) also recognized that organizations must back up their words with actions when it comes to the execution of the reward system. For example, companies must deal with poor performance in the same manner as they reward good performer. It is important for the good performers to see the poor performers either trained or removed.
Milkovich (1991) identified internal benefits from a reward system such as better productivity, reduced nonattendance and reduced turnover. A good reward system inspires individuals to do more than they would normally do. This increased efficiency saves the company money and resources. These reduced nonattendance rates and higher job longevity provide long-term impact to the success of the organization and save resources. Milkovich (1991) also acknowledged that externally, a good reward system would allow the company to attract top personnel. This is because personnel that are job hunting seek out those companies with attractive reward systems.
Leaders must ensure the reward system is appropriate for their organization. If the reward system is inappropriate for the organization, negative consequences may results. Reward system that set workers as rivals in reaping the reward tend to undermine the credibility of the company along with the dedication of the workers (Wilson, 2002). A quick evaluation of this type of reward system leads to the conclusion that management should only reward workers who achieve or exceed the stated objective. For the other workers, leaders must provide the necessary training so that they can also meet their objectives. This is a huge challenge for leaders, but the long-term pay-off from such an endeavor is well worth the effort. In the end, it results in a
triumphant system for management and the employees.
Wilson (2002) described reward systems as entitlements for some employees. This occurred when there was a mismatch with the alignment of the reward system with the performance of the workers. The workers feel that the reward is a right for them no matter what. They do not think they have to do anything out of the ordinary to receive the reward. This becomes a culture in the organization and workers view the reward as automatic. Wilson (2002) provided an excellent example of this with the employee health insurance premiums. Employees balked when they had to make a higher co-payment even though there was a significant change in the market. That is the problem when leaders allow their reward system to become an entitlement system versus a system dictated by the performance of the employees.
Impact of generational differences
The four generations of today’s workplace cover nearly eighty birth years, from 1922 to 2000 (Zemke, 1999). They are the Veterans, 1922 - 1943; the Baby Boomers, 1943 - 1960; the Generation X’ers, 1960 - 1980; and the Nexters/Generations Y’ers, those born 1980 and after (Zemke,1999). Each of these four generations, their formative forces, values, and views, their workplace aspirations and dreads, their hopes and fears, their delights and disappointments, permeates the workplace (Zemke, 1999). The four generations in the areas of trust, contribution, and reward influence organizational and work perceptions. Different attitudes, loyalties, and career aspirations influence each generation impact on the workplace.
The four generations, Veterans, Boomers, Xers, and Nexters/Y’ers’ have unique work ethics, different perspectives on work, distinct and preferred ways of managing and being managed, idiosyncratic styles, and unique ways of viewing such issues as quality, service, and, just showing up for work. Managing this diversity of ages, faces, values, and views is an increasingly difficult duty. For one thing, few Americans are able to understand their own generation in context.
It is difficult to look at one’s own life as part of a segment, trend, era, or generation. It feel too unique and individual, an overarching American value, and too isolated to be a simple statistic. People of all ages feel a disconnection with history. Many have difficulty placing their own thought and actions, even their own lives, in any larger story. It is diversity management at its most challenging. The obvious markers of race and sex have less clear impact on the differences and signal less in the way of differential treatment than do generational differences.
As business grows more and more competitive and companies continue to right size, reengineer, and reorganize, severe challenges confront frustrated managers. In evaluating the military, it exercises excellent control of these generational differences, which eases these challenges. Organizations are working hard to identify clues that will show them how to attract the people they most want to hire. The best way to do this is to focus on what people have in common. Most studies show that when people are asked what they like most (or least) about work, most answers were the same across the various employee groups. In addition, companies must know what make employees feel committed to their companies.
Organizations must understand the uniqueness of the various generations such as the
expert use of the internet by Generation X’ers and Y’ers. Companies must understand that the failure to understand this difference can results in miscommunication, harsh feelings, and create dysfunctional supervisor-employee relationships. Employers will have to clarify the needs and values of all working generations while maximizing productivity among them.
Generational conflict in the workplace is not new, and it is not going to go away. Employers must sort through the stereotypes and delineates the strengths and weaknesses of Veterans,
Boomers, X’ers, and Y’ers and turn conflict into harmony (Zemke, 1999).
Nevertheless, at the same time, companies must understand the important needs of their employees are the same, which includes company effectiveness, personal utilization or effectiveness, economic and interpersonal treatment, and enjoyment of work. Organizations are beginning to realize that while focusing on the differences in individuals they find that individuals are more alike. When companies query individuals about what makes them feel committed to their companies, things at the top of their list were the same.
Employees agree on what inspires their commitment, what companies do right, and what needs to be improved. Companies who successfully address these issues will solve the most pressing issues for every employee group (Pfau & Kay, 2002). The bottom line for an organization to attract and retain employees is to places its focus on the fundamentals. Companies that succeed in addressing company effectiveness, personal utilization effectiveness, economic and interpersonal treatment and enjoyment of work will win the battle of finding talented workers (Pfau & Kay, 2002). One way to win this battle is to understand each generation and deal with them appropriately in regards to trust, contribution, and reward in the workplace.
Trust and the generations
All of the generations value the importance of trust. The Veterans and Baby Boomers are less incline to trust their leaders than X’ers and Y’ers (McGuire et al., 2007). They do not have complete confidence in the information that they receive from their leadership. The exposure of downsizing, reengineering, and economic uncertainty contributed to this lack of confidence for the Veterans and Baby Boomers (McGuire et al., 2007). On the other hand, X’ers and Y’ers are likely to have their confidence rattled because of the lack of exposure; however, it will be interesting to see how the current economic downturn will affect the X’ers and Y’ers outlook upon trust for management.
Time will tell if this group will maintain their high level of trust as significant economic upheaval continues. In addition, the Veterans and Boomers normally do not place their leaders in their social contact network, while this is the norm for the X’ers and Y’ers (McGuire et al., 2007). Further, Veterans and Boomers expressed fewer concerns about being managed by someone younger than they are versus the X’ers and Y’ers (McGuire et al., 2007). Finally, Veterans and Boomers feel that their access is restricted to their leaders while the X’ers and Y’ers feel the opposite (McGuire et al., 2007). Overall, the Veterans and Boomers expressed more apprehension over their leader’s capabilities and the vision of the company than the X’ers and Y’ers. In the area of contribution, the generational differences are even more obvious.
Contribution and the generations
Each employee group wants the opportunity to contribute by using their talents and participating in decision-making. X’ers and Y’ers expect meaningful work so they can utilize their skills (Aldisert, 2002). They will continue to work as long as they feel they are making a valuable contribution to the organization. They also expect to grow and learn from the job experience. In addition, they also want the opportunity for engaging in leisurely events (Aldisert, 2002). X’ers and Y’ers want challenging tasks accomplished within the workday while Veterans and Boomers want their challenging tasks to be accomplished over several days (Sessa, et al., 2007). Further, X’ers and Y’ers want to have flexible hours while the Veterans and Boomers preference is regularly scheduled hours (Sessa, et al., 2007). There are also varied differences pertaining to each generation participating in decision-making.
Involving the employees in the decision-making process is an important element of
effective management. It is a key attribute in creating subordinate’s loyalty and buy-in to the organization (Hendricks, 1996). The generations respond differently to this process. It is important that leaders understand their employees so that they can maximize efficiency with their involvement. Different employee groups respond in different ways. The majority of the times, pertaining to involvement, the Veterans and Boomers are more tolerant of less involvement than the X’ers and Y’ers (Hendricks, 1996). X’ers and Y’ers respond negatively to exclusion in decisions about their jobs, therefore, they will resist the decision if collaboration is missing (Hendricks, 1996).
Aldisert (2002) espoused a similar view regarding the importance of contributions among the generations. For example, an area of discourse among the generations was rigid structure versus teamwork. The Veterans were more tolerant of rigid structure and directive type leadership due to growing up in the manufacturing environment (Aldisert, 2002). The Boomers tolerated the rigid structure and directive leadership style but are not fans of it (Aldisert, 2002). Generation X is a huge proponent of teamwork and can shut down in a rigid structure (Aldisert, 2002). Generation Y supports a similar view in that they do not understand bureaucracy and directive leadership since it is not part of their view of the world. These groups further exacerbated these differences in reward expectations.
Reward and the generations
Sessa et al. (2007) discovered that promotions were of greater concerns to X’ers and Y’ers than for the Veterans and Boomers. There was also a greater probability of X’ers and Y’ers terminating their employment if they won the lottery. In addition, Veterans and Boomers considered their work a more significant part of their lives than the X’ers and Y’ers. Further, X’ers and Y’ers differed with the Veterans and Boomers on retirement plans. For example, Veterans and Boomers preferred retirement plans with benefits while X’ers and Y’ers preferred a portable 401K with lump sum distribution (Sessa et al., 2007).
Veterans and Baby Boomers are fans of long-term reward packages, whereas X’ers and Y’ers are fans of the short-term reward and benefits packages. This is probably a reaction to the loss of final salary pension schemes. Organizations are offering pensions, child-care vouchers and buying or selling holidays to meet the needs of the different life stages of their employee groups (Hankin, 2004). Organizations must recognize these differences, but at the same time, it must promote outstanding personnel even if it means promoting a younger generation worker over an older generation worker. If not, eventually, the X’ers and Y’ers will depart the organization due to the longevity based recognition and promotion systems.
The Veterans and Boomers think that length of service vice merit should determine the appropriate pay (McGuire et al., 2007). Of course, this is the complete opposite of the X’ers and Y’ers, who think that performance should be the controlling factor and not length of service for determining pay. The X’ers and Y’ers will engage with the formal performance processes in the organization to assist with improvement in their performance. This is foreign territory to the Veterans and Boomers because they expect pay to be determined by time served versus good performance. According to Hankins (2004), Veterans is the generation that understood about cash only and how to save their money. They are true proponents of structure and think that leaders should reward seniority in regards to promotions or raises.
Conclusion
Today’s business environment pace is lightning fast. The competition is tough, smart, and coming from every direction. Those who succeed, in the end, will do so because of the talent they put on the field. Companies without creativity, performance, and problem solving at every level of the organization will never even get into the game. The workforce and workplace consist of constant change. Organizations face a difficult task in attracting, retaining, and motivating employees due to generational differences, Boomer’s retirement, potential labor shortage, and increasing number of minorities in the workforce. This challenge confronts all organizations as they try to sustain high performing employees. The organizations must comprehend the importance of trust, contribution, and reward along with their impact of generational differences.
The importance of trust, contribution, and reward is a critical area of focus for employee groups. The workplace consists of four generations and their differences directly affect trust, contribution, and reward. Trusted and capable leaders with a vision are essential to the success of the organization in managing each of these generations. Further, in each generation, employees desire the opportunity to contribute using their talents and participating in the decision-making. The degree of decision-making varies according to the generation. Finally, leaders must offer competitive rewards. Even through the various desires of each generation for rewards, they want the appropriate personnel rewarded and poor performers trained or their employment terminated.

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Article Credits: Capella University.