Customization versus Standardization
Engaging Employees and Leveraging Their Strengths
In employee management practices, customization and standardization are intertwined. The central question is: "How can we customize the employee experience and the employment deal to engage employees and drive performance - without sacrificing cost, efficiency, and fairness?" Customization often takes the form of the opportunity to select and combine from among a set of well defined (and, in fact, standardized) options. Companies like Dell Computer are experts at the "mass customization" of products - a special configuration for each customer order. But that ability to configure products depends upon the standardization of major component parts, their interfaces, and the information system that controls the ordering and configuration process. The same is true when customizing employee benefits, training, and most other elements of the employment deal. You need to start with well-defined and combinable options and a standard-but-flexible information systems platform for selecting and managing them.
There are four facets to customizing the employment relationship. To make the most of your customization initiatives, you must cover all four in mutually reinforcing ways:
- Construct. This focuses on the work itself. What is the job? How is it structured and how clearly is it defined? How much team interaction is there? What are the schedule and other work arrangements?
- Compensation. This includes everything that employees get in return for their labor - salary and benefits, direct and deferred compensation, learning and development opportunities, and stimulation and enjoyment from the work itself and the workplace environment.
- Connection. This focuses on how employers relate to the individual employee. It includes understanding and adapting to employees' preferred style of management - the amount of interaction, the frequency and formality of feedback, and the preferences for directive versus participative management.
- Communication. This focuses on why employees care about the success of the organization. What are the key messages and shared values communicated by the organization and embodied in the behaviors of its employees, especially its leaders? How consistently are these messages and values reinforced? What makes the individual feel an important part of the organization? How strong are the intangible "ties that bind" - including aligned values and strong culture?
Customization does not mean total individualization, every employee getting a completely different deal. Rather, it means knowing enough about your workforce as individuals to be able, for example, to give individual employees the opportunity to develop and grow in the skills, competencies, and career paths they choose; and to craft benefits packages that meet the needs of employees' personal situations, families, and life and career stages.
This Re.sults report discusses the need for customization and its role in accommodating employee variety, raising engagement, and playing to people's strengths.