At a time when retaining talent has become an imperative for most organisations, finance leaders will need to re-examine how they recognise and reward their top performers. Unless leaders understand what drives and ultimately retains their leading team members, they risk losing them to more talent-savvy organisations.
"If a top performer isn't adequately recognised, either their performance will start to tail off due to a lack of motivation or they will leave the business for a more exciting opportunity," said James Owen, FCMA, CGMA, and Global CFO of the Profiles division at Kantar, an evidence-based insights and consulting company based in London. And if the high achievers begin to leave, this sends a destabilising and negative message to other team members, he cautioned.
"Acknowledging the achievements of top performers drives motivation amongst the rest of the finance team," added Brittany Cummings, CPA, director and assistant tax quality leader at accountancy and advisory firm FORVIS in the US. "It builds a positive culture, particularly if these top performers also recognise and acknowledge the work of junior team members as they grow."
Yet recognising these top performers is not simply a matter of increasing bonuses and providing juicy financial incentives.
"Money tends not to be the primary motivating factor with talent [in the finance industry]," Owen said. "Far more critical is rewarding top performers with visibility, praise, and stretching projects."
FM magazine spoke to Owen, Cummings, and Bradley Kirkman, Ph.D., Shelton Distinguished Professor of Leadership at North Carolina State University in the US, to find out how finance leaders can ensure they are effectively rewarding and recognising their top performers. Their advice includes the following:
Design recognition systems with your team. To ensure buy-in, finance leaders should involve their team in the process of designing recognition and reward systems, said Kirkman, who is also the co-author of 3D Team Leadership: A New Approach for Complex Teams.
"Team members will buy in more to a recognition system if they have a hand in developing it, and it also takes the pressure off leaders having to come up with all the ideas," he noted.
As part of this inclusive process, he also encouraged leaders to consider implementing peer-to-peer recognition systems and platforms. This is a far more decentralised approach that empowers all co-workers to acknowledge positive contributions to the team. It also allows employees to give positive feedback to their managers instead of the usual top-down approach.
"A peer-to-peer recognition system gives everyone a voice, and this in turn can boost performance, morale, and retention," Kirkman said.
Provide challenge and visibility. According to Owen, one of the most important ways to reward top performers is by providing them with the space to "spread their wings" and to take on ever more complex and challenging work.
"Just as importantly, this work needs to be visible and high-profile," Owen said. "Wherever possible, I try to allow high-performing individuals and top talent to eat into my own remit, as this gives them extra experience … while also laying the foundations for succession planning."
In addition, Owen said that top performers should be rewarded and recognised by a hands-off management approach.
"Whilst it is critical to set them up for success at the outset, delivering clear guidance and ensuring they have the appropriate level of resource, top talent ultimately needs space and the ability to use their own excellent judgement and adaptability to continue to deliver high-quality results."
For instance, this could mean having fewer regular meetings and one-on-ones with finance managers, he noted.
Be specific with your praise. "It is important to provide praise and acknowledgement in person as much as possible and also to be very specific," explained Cummings. "Being specific should involve explaining how their work positively impacted the team and wider organisation."
For instance, this could include praising a team member for their work on a tax return over the weekend and explaining how this saved the client from paying late penalties — and ultimately fulfilling the company's mandate of excellent customer service.
"Wherever they can, leaders should praise achievements in a way that ties them back to the organisation's values, culture, and processes," she added. "If a top performer is using a particular internal process very effectively, for example, praise them for this and explain how it affirms the company values, such as 'unmatched customer support through internal efficiencies'."
Support "job sculpting" and passion projects. Instead of focusing on monetary rewards or material incentives, Kirkman suggested that finance leaders also reward top performers with the opportunity to do work that carries personal importance and meaning for them. In the wider labour market, this is often referred to as "job sculpting".
"This means empowering your top performers to tweak the contours and specifics of their jobs to make them more personally meaningful and interesting," he said. This could include, for example, allowing a finance manager to do pro bono work once a week for a charity or not-for-profit organisation, or spending one day on an innovation project that doesn't fall within their normal scope of work.
Cummings added that finance leaders have a responsibility to ensure their top performers are able to pursue their passions. "Show recognition by allowing top talent to follow their interests, and by considering how you can help them achieve their goals," she said. This show of goodwill will keep your top performers motivated, engaged, and passionate.
Be transparent and accurate. To prevent accusations or perceptions of favouritism, Kirkman emphasised the importance of transparency and consistency.
"You have to make sure your decision criteria for recognition and rewards are known to everyone and that the criteria are fair, measurable, and transparent," he said.
In practice, this means that finance leaders should have a clear, standardised system of evaluating performance. This system should include a process that defines who evaluates what, using specific information as a basis, and how leaders and/or peers weigh the input from different evaluators and on different skills. If leaders simply rely on subjective and ad hoc criteria, their system will be biased and overly influenced by stereotypes and favouritism.
"I try to major on transparency of decision-making, as that helps people rationalise 'why' and 'how' a particular call was made, instead of just delivering the 'what'," Owen explained. "Over time you should naturally develop a track record for being fair and balanced as a consequence of building trust."
He also pointed out the importance of ensuring fairness and equity through thoughtful leadership, such as being more conscious about how meetings are chaired.
"Trying to avoid letting big characters and/or superstar talents dominate discussions can really help develop a strong culture of cohesion, fairness, and equality … especially by bringing in gentler voices into the debate as often as possible."
As finance leaders grapple with the challenges of a rapidly changing workplace, retaining top talent with intentional and strategic steps should pay dividends in the short and long term.
— Jessica Hubbard is a freelance writer based in France. To comment on this article or to suggest an idea for another article, contact Oliver Rowe at Oliver.Rowe@aicpa-cima.com.