First, I must say that Manager Tools is the best thing I've found on the Web to help myself and my team. I've been wading through sites that keep telling what I already know not to do.

Second, I was placed in a management role over a year ago but have spent the last year just cleaning up the mess that was left for me. Now I can actually concentrate on managing effectively. This site is helping me a great deal. I can't get through the podcasts and forum fast enough.

There is one problem that I have not been able to "fix" in my current company that I needed some advice with . I have given an annual review to 3 of my team over the past 6 months. I was one of their peers before being promoted. So, I do have a concept on how hard they work and how well they do their jobs (from a peer perspective and now management). My problem is that the owner seems to pick a percentage increase out of the air despite my justifications for the raise. There is no rhyme or reason that I can figure out. I've asked for an explanation but rarely get one that makes any sense.

How do I keep my team motivated and productive even though it seems like they are not being compensated properly? And how do I deliver the news of their raise even though I completely disagree with it?

I apologize for the length of the post. Sometimes my "work" side of the brain never seems to sleep. That and I am questioning my validity of being a manager.

I appreciate any feedback that will help me considering I have 4 more reviews to go....


Dani Martin's picture
Licensee Badge

Hi Jeff -- I, too, face the challenge of relatively small pay increases due to working in the non-profit sector. We are currently finishing up annual reviews for our staff (our fiscal year runs Sept-August). The review discussions are a great time to discuss with directs what would be a meaningful reward for them. Lacking a large budget, we are forced to get creative. A few things we've come up with:
Additional paid time off
Single hotel rooms when traveling - they like this because our standard policy is that staff share rooms
New office equipment/supplies - about 70% of my staff are home-based and are always in need of some equipment or supplies (again, because budget is limited for these items)

My advice on how to deliver the news when you disagree is to stay positive, acknowledge that you can't change it and ask what you could offer instead. Of course, having strong relationships with your directs through O3's, feedback and development goes a long way here, too.

Hope this helps! Good luck!

bren811's picture

Hi Jeff, I also work for a not for profit. We have small, incremental pay rises with little opportunity to negotiate based on performance. I try to focus on the non financial rewards. One on ones have been very useful here in identifying what will be motivating for different employees. Some of the things we use at my workplace include:
*small gifts such as wine, chocolates etc to acknowledge effort
*employee of the quarter awards/safety awards
*time off for study and other development opportunities
*flexi time
*social events for staff
*creating whatever opportunities I can for staff using my network
*allowing staff to focus on their preferred tasks at work

We are exeperiencing extreme labour shortages here in Western Australia at the moment so staff retention is a huge issue, and one that I have to constantly work at. I am finding retention rates are improving since implementing strategies above.

I agree with Dani - I would acknowledge the aspects of pay that are out of my control and focus on rewarding staff in ways that are within my control.


bflynn's picture

One additional thought - focus on the things that you believe will retain your employees. Happiness and retention are related but not the same. How do you know what will help keep them here? Listen to their pain and work to ease it.

Do not attempt to make them happy; happiness is their choice. To turn the umbrella story around, they are not happy because they get good pay or extra time off. You give them those things and your employees choose to be happy.

There is a minimum level you have to do to keep them. You don't get credit for doing more. The pain will make them leave, but doing extra will not keep them if they're experiencing pain somewhere.


danstratton's picture

Ben there in the private sector as well. Like others have said, there is more to happiness than pay increases. Except in cases where compensation is REALLY out of whack (had to go to the mat more than once there), I work for the little intangibles. There is a good book called [u]1001 Ways To Reward Employees[/u]. [url]

I have used it to find ways to say 'thank you' without spending much to any money. It has really helped for those little instances where I can't give a raise, but want to do something. Dani and others have put in some great ideas. This book is full of them. It just takes a little creative thinking outside the salary box. Good luck![/u]

JThorogood's picture

Thank you for the input. It made me realize I may be attacking the issue on the wrong front.

This will be fun. I start the one-on-ones in 2 weeks and I can't wait. I think that will help a lot.


tlhausmann's picture
Licensee BadgeTraining Badge

[quote="FistCheese"]Thank you for the input. It made me realize I may be attacking the issue on the wrong front.


I also work in the non-profit sector. Good, trusting relationships developed through open communication have improved retention. Although the pay is not market rate the environment is first rate.

terrih's picture

Does for-profit or not-for-profit really figure in? If the for-profit is in a cash flow crunch, there may be NO raise for ANYone. Been there, done that, a couple times. :(

bflynn's picture

It makes a difference in employee motivations. At a not for/non-profit, more employees are there for the love of the job and what they are contributing.

Additionally, since shareholder value is not the objective of the organization, there is a different focus on what money means. Money is a way to do something and not an accomplishment on its own. Income is as lean as possible because lower prices means more demand for services, which validates why the NP is in business to begin with. In a way, when an employee takes higher pay, they are very slightly reducing demand for their services.

Its a different mindset.


danstratton's picture

My observations, but if an employee thinks the pay is too low to survive, they will leave. What we as managers have to do is make for the difference - make the rest of their worklife better to compensate so that they wouldn't want to leave for just a little more money. You are on the right track. One on Ones are critical to that. My team demands them now. Expect them. It is part of the job. Others see them happening and are insanely jealous. Side benefit is building loyalty. 8) I had one move to another team and ask me to not stop our one on ones. Sorry, no. Leave my team, will you... :twisted: