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HOW TO KEEP YOUR EMPLOYEES HUNGRY FOR SUCCESS

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How To Keep Your Employees Hungry For Success

If you are a company owner, there will almost certainly be a conflict between what the company means to you and what it means to your staff.

Say you founded the company, and expended a great deal of time, money and effort in making it successful over many months or years. Your livelihood, and that of your family, may be directly linked to the company’s performance – if financial performance is poor, even briefly, you may need to reduce the salary you pay yourself, or cut your dividend payment. If the company goes under, severe hardship might follow for you and your loved ones.

In the eyes of your employees, you might be little more than a source of income in order to pay their bills. They can work their contracted hours and then go home, not needing to think about work until the following morning. A short-term fall in company profits will not affect their salary.

How To Keep Your Employees Hungry For Success

How To Keep Your Employees Hungry For Success

If employees are meeting the minimum requirements of the job, you cannot justify disciplinary action against them. If redundancies are not being considered, your staff may start to ‘coast’, whereas you might want them to give more, as well as feeling that they are capable of more.

Here we look at ways you might be able to motivate your staff.

Increase basic salary

This is perhaps the oldest and best known motivational tool in the book. It may make the employee feel better towards the company, and improve performance as a result. However, aside from the fundamental issue of whether you can afford the increase, you need to think carefully before taking this step. How might an individual employee respond to a pay rise? For some, it could mean that they coast even more – see above. They may regard the rise as an endorsement of the way they are doing their job. It may even reduce their motivation, in that now they are better rewarded, there is little incentive to try and secure an internal promotion. On the flip side, of course, it might give them a much needed ‘shot in the arm’ and encourage them to be more productive.

Performance-related pay

This approach is usually adopted for salespeople and other staff who can have a direct impact on revenue and profits. Some companies make much more use of performance-related-pay (PRP) than others.

Systems of PRP can include commission payments for sales made and bonus payments for achieving performance targets, which can be related to sales volume and/or quality standards.

The idea behind PRP is that people will want to achieve more in order to be better remunerated. However, extreme care needs to be taken with such a system.

Firstly, you need the systems in place to make accurate and fair measures of employee performance. Measuring the volume or value of sales made could be relatively easy, but judging whether quality standards have been met could be much more subjective. As well as having to devise a reliable way of measuring performance standards, there is also the issue of using up valuable time and resources if supervisors or others need to carry out an in-depth analysis of individual employees’ performance.

Secondly, dissatisfaction can arise amongst staff who are not doing well under the PRP system. They may decide, rightly or wrongly, that the methods used to measure performance are not accurate or not fair.

PRP can also widen the gap in remuneration levels between the top and the bottom of the company. If bonuses are calculated as a percentage of basic salary, then the inducement payments in purely monetary terms will be higher for better paid staff. Sometimes, people in senior roles receive significantly higher bonuses when calculated as a percentage of salary, which could have a further adverse affect on the morale of the lowest paid.

Incentive schemes

You may decide to operate an awards scheme and allow managers of business departments to nominate deserving candidates from amongst their staff. The scheme might involve cash paymentsfor certain achievements.

Incentive schemes might also operate on a less formal basis, perhaps where an employee is given a gift for completing a one-off task successfully or hitting specific targets.

Incentive schemes may not require the same detailed analysis of performance that PRP necessitates, but the potential for resentment amongst your staff still exists. Some might feel their achievements are not being recognised, whilst equivalent or even lesser achievements from colleagues are rewarded instead.

Job enlargement

Job enlargement is best described as widening the scope of an employee’s role. One method of doing this is to add to their job description tasks related to those they already undertake. The employee may welcome this if they like the added variety and the added responsibility that comes with it. It can make the employee feel they are making progress within the company, and that their contribution is valued. This can be especially important if promotion opportunities are limited. However, be wary of an employee ending up with an increased workload for no extra reward, which they may not welcome; or giving them additional tasks and responsibilities that they may not relish.

Delegation

An employee may sometimes feel they have to do all the work but have no influence, while their boss takes the reflected glory. Consider what responsibilities you can delegate – obviously this will require you to assess the skills, experience and abilities of your staff to determine what they are capable of.

Better communication

De-motivation can result if employees don’t know what’s happening in the company as a whole. Some information undoubtedly needs to remain confidential, but if you have new initiatives, good financial results or other achievements to report, why not share them with your staff, perhaps via a company announcement or newsletter? Also consider what you can do to gauge opinion amongst your staff, e.g. via an anonymous suggestion box.

Also try and inform your staff of the contribution they make to the organisation’s overall success. This is particularly important for junior staff in large companies, where they may feel especially insignificant.

Social events

These events can boost morale, and make people look forward to going into the office on the next business day, even if it is just to reminisce about the evening with colleagues. But take care not to create an atmosphere where attendance is practically viewed as mandatory – whatever it involves; an individual event will not suit all tastes.

Away days

Whether these involve work-related tasks or leisure activities or a combination of the two, many companies see them as useful ways of improving workplace performance. The idea is that if employees work together on tasks on away days, their cohesion when working together in the workplace will improve. Some employees will undoubtedly enjoy this type of team bonding event, but think carefully before announcing something like this. If employees are asked to undertake physical activities for which they have no aptitude, e.g. the traditional company ‘outward bound’ day, it might end up having a reverse effect.

Author Biography: Keith Tully is a business recovery professional with Real Business Rescue, a firm of insolvency practitioners dedicated to helping struggling companies across the UK.

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Audi aims to sell one million cars in China in 2023

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Audi aims to sell one million cars in China in 2023 1

BEIJING (Reuters) – German premium automaker Audi aims to sell 1 million vehicles in China in 2023, versus 726,000 vehicles in 2020, the brand’s China chief Werner Eichhorn said on Wednesday.

Audi, which is making cars in the world’s biggest auto market with FAW Group, will also add more products in China, Eichhorn said. Audi’s rivals include Daimler and BMW.

(Reporting by Yilei Sun and Brenda Goh; Editing by Himani Sarka

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Netflix forecasts an end to borrowing binge, shares surge

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Netflix forecasts an end to borrowing binge, shares surge 2

By Lisa Richwine and Eva Mathews

(Reuters) – Netflix Inc said on Tuesday its global subscriber rolls crossed 200 million at the end of 2020 and projected it will no longer need to borrow billions of dollars to finance its broad slate of TV shows and movies.

Shares of Netflix rose nearly 13% in extended trading as the financial milestone validated the company’s strategy of going into debt to take on big Hollywood studios with a flood of its own programming in multiple languages.

The world’s largest streaming service had raised $15 billion through debt in less than a decade. On Tuesday, the company said it expected free cash flow to break even in 2021, adding in a letter to shareholders, “We believe we no longer have a need to raise external financing for our day-to-day operations.”

Netflix said it will explore returning excess cash to shareholders via share buybacks. It plans to maintain $10 billion to $15 billion in gross debt.

“This is in sharp contrast to Disney and many other new entrants into the streaming market who expect to lose money on streaming for the next few years,” said eMarketer analyst Eric Haggstrom.

From October to December, Netflix signed up 8.5 million new paying streaming customers as it debuted widely praised series “The Queen’s Gambit” and “Bridgerton,” a new season of “The Crown” and the George Clooney film “The Midnight Sky.”

The additions topped Wall Street estimates of 6.1 million, according to Refinitiv data, despite increased competition and a U.S. price increase. Fourth-quarter earnings per share of $1.19 missed analyst expectations of $1.39.

With the new customers, Netflix’s worldwide membership reached 203.7 million. The company that pioneered streaming in 2007 added more subscribers in 2020 than in any other year, boosted by viewers who stayed home to fight the coronavirus pandemic.

COMPETITION HEATS UP

Now, Netflix is working to add customers around the globe as big media companies amp up competition. Walt Disney Co in December unveiled a hefty slate of new programming for Disney+, while AT&T Inc’s Warner Bros scrapped the traditional Hollywood playbook by announcing it would send all 2021 movies straight to HBO Max alongside theaters.

Disney said in December it had already signed up 86.8 million subscribers to Disney+ in just over a year.

“It’s super-impressive what Disney’s done,” Netflix Co-Chief Executive Reed Hastings said in a post-earnings analyst interview. Disney’s success, he added, “gets us fired up about increasing our membership, increasing our content budget.”

Netflix said most of its growth last year – 83% of new customers – came from outside the United States and Canada. Forty-one percent joined from Europe, the Middle East and Africa.

For January through March, Netflix projected it would sign up 6 million more global subscribers, behind analyst expectations of roughly 8 million.

Revenue for the fourth quarter rose to $6.64 billion compared with $5.47 billion a year ago, edging past estimates of $6.63 billion.

Net income fell to $542.2 million, or $1.19 per share, from $587 million, or $1.30 per share, a year earlier.

Netflix shares jumped 12.5% to $564.32 in extended trading on Tuesday.

(Reporting by Eva Mathews in Bengaluru and Lisa Richwine in Los Angeles; Editing by Sriraj Kalluvila and Matthew Lewis)

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MGM Resorts drops takeover plan for Ladbrokes-owner Entain

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MGM Resorts drops takeover plan for Ladbrokes-owner Entain 3

By Tanishaa Nadkar

(Reuters) – Casino operator MGM Resorts International on Tuesday ditched plans to buy Ladbrokes owner Entain after the British company rejected an $11 billion takeover approach this month, sending Entain’s shares down nearly 12%.

The United States is seen as the next big growth market for sports betting, spawning a series of transatlantic partnerships tapping in to European technology and expertise. These include Caesars Entertainment agreeing last September to buy William Hill in a 2.9 billion-pound deal.

MGM said it would not submit a revised proposal or make a firm offer for Entain, which had said the approach announced two weeks ago significantly undervalued its business.

Entain shares closed down 11.9% at around 12.44 pounds in London. MGM shares were up 2.5% at $30.54 in New York trading late on Tuesday afternoon.

“We look forward to continuing to work closely with MGM to drive further success in the United States through the BetMGM joint venture,” Entain said in a statement.

Online betting firms have benefited during the COVID-19 pandemic-led lockdowns, as customers took to playing from home when casinos and betting shops were off-limits.

MGM had previously said a merger with the British bookmaker would be compelling and believed a deal would help expand BetMGM, which the two have operated since 2018.

The proposal, on the basis of 0.6 MGM share for each Entain share, was also backed by billionaire Barry Diller’s IAC. It valued Entain shares at 13.83 pence each when it was first announced.

Complicating matters, Entain Chief Executive Officer Shay Segev decided to step down just seven months into the role and in the middle of negotiations with MGM to take a job with sports streaming service DAZN.

Segev’s departure, as well as limited engagement in talks shown by Entain and a difference in price expectations between the two sides, led MGM to decide to walk away from the deal, according to a person familiar with the matter.

Entain, previously known as GVC, has itself expanded rapidly through a series of acquisitions and owns the bwin, Coral and Eurobet brands, operating traditional British high street betting shops as well as offering online gambling.

“While we are genuinely surprised MGM didn’t up its consideration … we don’t think this changes MGM’s ability to secure equity value enhancing benefits from the attractively growing US sports betting and iGaming pie,” JP Morgan analysts said.

The brokerage said it would not rule out further discussions with Entain depending on how the company shareholders reacted, adding it would be tough for someone else to buy Entain given so much potential equity value coming from the 50/50 BetMGM joint venture.

(Reporting by Tanishaa Nadkar in Bengaluru; Additional reporting by Joshua Franklin in Miami; Editing by Keith Weir and Matthew Lewis)

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